At its high near $41 a share, GrubHub’s market value topped $3.4 billion. That is 20 times 2013 revenues, even allowing for the acquisition of Seamless.
GrubHub makes its money by charging restaurants a commission when a customer places a takeout or delivery order through one of its websites. The company covers some 28,800 restaurants in 600 cities.
The company also picked a good time to come public. According to a report at Forbes, there were 64 IPOs in the first quarter of 2014, which raised a total of $10.6 billion. That is the most active first quarter since 2013 and double last year’s action.
The loser after this IPO is Yelp Inc. (NYSE: YELP), down 5.4% to $66.84, in a 52-week range of $23.11 to $101.75. Yelp’s market cap at Friday’s trading price is about $4.8 billion.
One more thing GrubHub and Yelp need to look out for is a new feature of Google Inc.’s (NASDAQ: GOOG) search engine that allows users to check the menu at restaurants returned in a search query.
GrubHub shares were up 40% to $36.40 shortly before noon on Friday. The stock earlier reached a high of $40.79.
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