- Instacart soared 40% above its IPO price on Tuesday as trading began.
- Its shares have since tumbled close to its debut price of $30 as momentum fades.
Shares in Instacart, America's largest grocery-delivery operator, tumbled on Wednesday on the second day of trading.
The stock soared 43% in its trading debut on Tuesday, but most of those gains were wiped out the following day when shares closed at $30.10, just 1o cents above its float price.
The fall was partly due to a wider selloff in equity markets ahead of Jerome Powell's Fed speech, and as analysts began to give their assessments on the stock.
Phil Lempert, a grocery analyst and editor of SupermarketGuru, told Bloomberg that consumers are choosing to shop in-person more. "Finally people can see under the hood related to Instacart that this is not a stable situation," he said.
"From a consumer standpoint we have seen a move away from delivery to click and collect, where a shopper orders online and schedules a time to pick up their groceries at the store," Lempert told the outlet.
Instacart's plunge is a cautionary tale for other companies thinking of coming to market following Arm's successful debut last week.
The chipmaker soared 25% on its first day of trading to be worth about $65 billion, but has since lost ground every day since then and is now valued at about $54 billion.