Personal Finance

Can Blue Apron Stock Keep Going After Last Week's 15% Pop?

A Blue Apron meal kit with all of the ingredients labeled.

One of last year's biggest IPO losers may be on the comeback trail. Shares of Blue Apron Holdings (NYSE: APRN) moved 15.2% higher last week, gaining ground after tapping a new CFO and introducing a new service promotion. There was also encouraging news out of the meal-kit niche leader, potentially boding well for Blue Apron. The stock would go on to inch higher in each of last week's five trading days.

Momentum is on Blue Apron's side since announcing better-than-expected financial results earlier this month. Blue Apron stock has now moved 34.4% higher in May, and is up a whopping 63.4% since bottoming out last month.

A Blue Apron meal kit with all of the ingredients labeled.

Image source: Blue Apron.

Thinking outside the box

Blue Apron getting a new CFO isn't necessarily a big deal. Investors tend to be more worried about when a chief bean counter bolts unexpectedly than excited when a replacement shows up. However, in Blue Apron's case it comes as a relief. Brad Dickerson had been Blue Apron's CFO for two years, but late last year he assumed the CEO role. Tapping Tim Bensley as its new CFO will give Dickerson more time to focus on orchestrating a turnaround at the struggling food service provider.

We're also seeing Blue Apron get more creative in cost-effective ways to draw attention to its brand. Just a few days after teaming up with widely followed celebrity Chrissy Teigen to offer six weeks of meal kits inspired by recipes from her cookbook, Blue Apron announced a series of "Unboxed" pop-up events across the country. Blue Apron is definitely not standing still in its attempt to breathe new life into its business.

The third piece of news that potentially played a small part in Blue Apron's rise last week was news that rival HelloFresh saw its revenue in the U.S. prepackaged meal market soar 44% during the first quarter. HelloFresh boosted its full-year outlook to 30% to 35% in revenue growth. Seeing HelloFresh pull away from Blue Apron -- which itself is coming off back-to-back quarters of double-digit declines in revenue -- may not seem like good news at first. However, it does confirm that the meal-kit market is alive and thriving despite Blue Apron's 20% decline in revenue during the same three-month period.

Things are starting to stabilize at Blue Apron. It had 786,000 customers at the end of March, a 5% sequential dip -- but the average revenue per customer is higher than it was both a year ago and during the prior year's fourth quarter. Blue Apron stock continues to be one of last year's worst-performing IPOs, but the comeback trail has to start somewhere.

10 stocks we like better than Blue Apron Holdings, Inc.

When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has quadrupled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Blue Apron Holdings, Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of May 8, 2018

Rick Munarriz has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

APRN

Other Topics

Stocks

The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

Learn More