Instacart (NASDAQ:CART) is seeing early signs that price parity, in which grocers charge the same prices online as in-store, could become a meaningful growth lever, according to a new Jefferies survey of US grocery delivery users.
The firm reiterated its Buy rating on the stock and raised its price target to $56 from $48.
The survey found that 69% of respondents cited lower prices as a potential driver of increased order frequency, nearly double the 38% who cited faster delivery.
No other factor was cited by more than 30% of respondents, underscoring affordability as a central lever for demand.
Most grocers on Instacart (NASDAQ:CART)'s platform still charge online markups, but Instacart (NASDAQ:CART) has said that partners offering price parity see app sales grow 10% faster. That data point is becoming a central piece of the company's pitch to grocers as it works to expand parity pricing across its network.
Amazon's expansion of perishables delivery over the past 18 months has raised competitive questions for Instacart, given that roughly two-thirds of Instacart+ members also use Amazon. But the survey suggests Instacart remains relatively insulated. Analysts noted its user base skews higher-earning, with 36% making more than $100,000 annually and just 37% making less than $50,000, compared with 22% and 52%, respectively, among competing platforms.
Selection, not price, is the top reason users choose Instacart, Jefferies said, citing roughly 50% of respondents versus about 25% who cited price. That lines up with Instacart's own data showing users order from five stores on average, a habit that Jefferies said reflects lower price sensitivity among the platform's core users.
Amazon's grocery push may also work in Instacart's favor by giving the company additional leverage to persuade grocers to adopt parity pricing, which would improve affordability for lower-income households where Instacart is currently underpenetrated.
Beyond consumer-facing growth, Instacart continues to expand its enterprise business. Its Storefront offering, which powers delivery through retailers' own websites and apps, grew from 310 banners at the end of 2024 to more than 380 by the first quarter of 2026, with growth concentrated among Instacart's larger retail partners. Storefront also serves as an entry point for deeper integration with grocers across retail media, connected store technology, and AI-driven tools, according to Jefferies.
On the back of these trends, Jefferies raised its 2027 gross transaction value and EBITDA estimates for Instacart by 1% and 2%, respectively, now sitting 2% and 4% above consensus. The firm's updated price target implies an 18x multiple on 2027 GAAP earnings, a 10% discount to the broader internet sector despite Instacart's projected earnings growth of 21% annually over three years, versus a 17% average for peers, a gap Jefferies attributes to lingering headline risk from Amazon's grocery ambitions.