Diamonds and Dogs

7/25/18

New grub at Grubhub (GRUB). The online and mobile platform for restaurant pick-up jumped 23% to new highs following earnings and an acquisition. Revenue skyrocketed 51% to $240 million, helped by a 70% increase in active diners to 15.6 million, and 29% growth in gross food sales to $1.2 billion. GrubHub's adjusted net income nearly doubled to $46.3 million, or $0.50 per share, beating estimates. Grubhub also announced it has agreed to acquire mobile diner engagement and payment solutions company LevelUp for $390 million, a move that will help Grubhub add online demand generation and fulfillment services.

Ma Bell looking a little bruised. AT&T (T) dropped 4.5% to a new 52 week low following earnings last night. AT&T actually beat estimates and raised guidance, but investors were concerned with the quality of earnings. The legacy businesses are declining across the board. The Time Warner merger offers some hope, but the company has a heavily leveraged balance sheet with a 163 billion in debt. The good news is the dividend yield is 6.3% as long as they don't have to cut it.