Maplebear Inc. (CART): A Bull Case Theory

We came across a bullish thesis on Maplebear Inc. (CART) on Chit Chat Stocks’ Substack. In this article, we will summarize the bulls’ thesis on CART. Maplebear Inc. (CART)’s share was trading at $47.02 as of 28^th May. CART’s trailing and forward P/E were 30.95 and 19.12 respectively according to Yahoo Finance.

Instacart (CART) has emerged as the dominant third-party grocery delivery platform in the U.S., controlling over 70% market share among independent providers. Founded by Apoorva Mehta in 2012, the company scaled quickly by leveraging a “ninja shopping” model—using independent shoppers to buy items in-store without grocer partnerships—and building a unique centralized SKU database. Instacart now reaches 98% of U.S. households, with approximately 8 million customers and 600,000 shoppers.

The company monetizes through service and delivery fees, tips, and increasingly, advertising. Since 2021, advertising has grown rapidly and now contributes nearly $1 billion of Instacart’s $3.5 billion in revenue, complementing the 6.5–7.5% take rate it earns on $34 billion in annual gross transaction volume. Ads appear across browsing, search, and post-order experiences, targeting CPG brands. Instacart boasts 75% gross margins and 24% free cash flow margins, supported by asset-light operations. Competitive concerns over Uber and DoorDash appear overstated due to Instacart’s superior shopper quality and customer loyalty, particularly for large, complex grocery orders.

While grocers like Walmart may pursue in-house delivery, most rely on Instacart for not only delivery but also e-commerce tools, inventory management, and white-label storefronts. CEO Fidji Simo, a former Facebook executive instrumental in its ads business, has driven growth but is departing for OpenAI. Instacart has bought back $2.2 billion in stock over two years, reducing its share count by 6%. While it lacks an impenetrable moat, Instacart occupies a sticky and underestimated strategic position in the evolving grocery and retail media ecosystem.

For a comprehensive analysis of another standout stock covered by the same author, we recommend reading our summary of his bullish thesis on Airbnb, Inc. (ABNB). Since our coverage, the stock is up 1.6% as of 28^th May.

Maplebear Inc. (CART) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 64 hedge fund portfolios held CART at the end of the first quarter which was 60 in the previous quarter. While we acknowledge the risk and potential of CART as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than CART but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

Disclosure: None. This article was originally published at Insider Monkey.