Blue Apron just received its first Wall Street analyst rating, and it's not pretty.
Chuck Cerankosky of Northcoast Research gave the company a price target of $2, according to Bloomberg. That's a measly 11.8% of the $15-17 per share Blue Apron was hoping for in its IPO. It's also far below the actual $10 opening price.
Cerankosky rates the value of the company at just above the value of the company's pro forma assets, according to Bloomberg. He wrote that sales growth at Blue Apron is dependent on discounts and isn't sustainable. High labor and shipping costs are also downsides to the company's business model, according to Cerankosky.
After Cerankosky released his rating, the price of Blue Apron plummeted. Shares are down 6.39% in early trading Tuesday at $7.68.
Blue Apron has struggled to get off the ground after its IPO. The company went public under the shadow of Amazon's announcement that it intends to acquire Whole Foods, which many consider to be a move by the internet giant to bolster its own food delivery service.
Along with Snap, Blue Apron is one of biggest IPO losers of 2017, and if Cerankosky is right, it won't be getting better any time soon.
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