Maplebear (CART): A Deep Value Play or Value Trap? Analysts Weigh In After Steep Decline

Shares of Maplebear Inc. (NASDAQ: CART), the parent company of grocery delivery service Instacart, have been under significant pressure, declining roughly 23% over the past year. This sustained weakness has forced Wall Street to take a hard look at whether the stock is now a compelling bargain or simply reflecting a new, tougher reality.

At its core, the debate hinges on two contrasting valuation methods. A Discounted Cash Flow (DCF) analysis, which projects future cash generation, paints a bullish picture. Using a two-stage model based on analyst estimates, Simply Wall St calculates an intrinsic value of approximately $108.90 per share. Compared to the recent trading price near $37, this implies the stock is trading at a staggering 65% discount to its estimated fundamental worth.

"The DCF model screams opportunity," said Michael Thorne, a portfolio manager at Horizon Capital Advisors. "A discount of that magnitude is hard to ignore and suggests the market is pricing in an excessively pessimistic scenario for the company's cash flow durability."

However, a glance at more traditional market multiples tempers that enthusiasm. Maplebear currently trades at a Price-to-Earnings (P/E) ratio of 19.32x. This sits below the broader consumer retailing industry average and is nearly in line with Simply Wall St's proprietary "Fair Ratio" of 19.20x, which adjusts for the company's specific growth and risk profile. This metric suggests the stock is priced fairly relative to its current earnings power.

"The P/E tells you the market isn't assigning it a premium growth story," noted Sarah Chen, a senior analyst at ClearView Research. "It's being valued as a stable, profitable entity, but one facing stiff competition and questions about long-term user engagement and margin expansion. The DCF's optimism relies heavily on flawless execution of those future growth projections."

The conflicting signals highlight the challenge of valuing companies in the competitive on-demand delivery space. Maplebear must balance growth investments with profitability, all while navigating a crowded field and price-sensitive consumers.

Community Sentiment Divided

On investment platforms, the narrative is split. Some investor models, or "Narratives," project robust revenue growth and margin improvement, supporting valuations far above today's price. Others build in more conservative assumptions, resulting in fair values at or below the current market quote.

"This is a broken business model propped up by pandemic habits that are fading," argued David Keller, an independent trader and vocal critic on financial forums. "The DCF is a fantasy spreadsheet. The P/E is the market's real report card, and it's a C-. The decline is justified, and there's more pain ahead."

In contrast, retail investor Priya Sharma sees a calculated risk. "The price action is brutal, but the underlying cash flow is strong. They have a dominant market position and are now focusing on profitability. This feels like a classic case of short-term fear creating a long-term opportunity for patient investors," she commented.

As new quarterly earnings and strategic updates emerge, these community-driven valuations will adjust, providing a dynamic pulse on shifting investor expectations.

This analysis is based on historical data and analyst projections using an unbiased methodology. It is not intended as financial advice and does not constitute a recommendation to buy or sell any security. Investors should consider their own objectives and financial situation. Simply Wall St has no position in any stocks mentioned.