Instacart (CART) stock got a buy call on Wall Street Monday with an analyst saying the company is easing investor fears about competition from Amazon (AMZN), Uber (UBER), DoorDash (DASH) and others. Shares of the grocery delivery firm edged higher in morning trading.

Needham analyst Bernie McTernan upgraded Instacart to buy from hold, with a price target of 65. McTernan said strong results from the company in 2024 show concerns about competition and the Covid-19 pandemic pulling demand forward were overblown.

"While there have been fears on total addressable market (TAM) pull forward and competition, recent results suggest post-Covid cohorts can drive consolidated gross transaction value (GTV) growth while Covid cohorts are stable, likely driven by Instacart's best in class customer experience, which they continue to improve," McTernan wrote.

On the stock market today, Instacart stock is up just under 1% at 44.61 in recent action. Needham also placed Instacart stock on its "conviction list" of stocks.

Instacart Stock Up 47% From IPO

Instacart, under its parent company name Maplebear, completed an initial public offering in September 2023. The stock has gained 47% from the company's first-day closing price, including a more than 80% gain in 2024.

Shares of Instacart were added to the S&P MidCap 400 index last Tuesday, boosting the stock nearly 5%.

In its most recent third quarter earnings report from November, Instacart beat expectations with earnings of 42 cents per share and sales growth of 12% to $852 million. But Instacart stock fell following the report on concerns about the company's Q4 sales outlook.

But McTernan wrote Monday that Instacart's recent results shows "stronger than expected" staying power from Instacart among customers that started using the service during the pandemic. That's despite concerns that the pandemic drove an unsustainable jump in demand, or a "pull forward," rather than increased the overall market.

"Our prior hold rating was driven by fears over the TAM (total addressable market) pull forward from the pandemic and competition as a variety of large players are competing for share in this market including Amazon, Walmart (WMT), Uber, DoorDash, etc.," McTernan wrote. "Instacart has been able to overcome these fears as they continue to improve their already leading customer experience."

Instacart also has a supply advantage over Uber and DoorDash, Needham found. And the company's focus on affordability through low-cost delivery options and loyalty program integrations is addressing a "key pain point" for customers, the report added.

Instacart Stock In Consolidation Pattern

Meanwhile, Instacart stock has formed a consolidation pattern, with an early November all-time high of 50.01 representing the buy point, according to MarketSurge.

Instacart stock has an IBD Composite Rating of 80 out of a best-possible 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one rating. The best growth stocks have a Composite Rating of 90 or better.

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