Shares of Blue Apron Holding Inc. (NYSE: APRN) were sliding again today, flirting with an all-time low as investor pessimism about the stock continued from last week. Though there was no single news item driving the stock lower, a number of factors seemed to have contributed to the decline. Blue Apron shares finished the day down 6.1%.
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Shares of the meal-kit provider have fallen 14% since the company announced a new partnership with Grubhub last week. In a pilot program being tested in New York, Blue Apron is making some of its meals available on GrubHub's delivery platform, though some observers questioned the move, as it doesn't fit with Blue Apron's value proposition, which prizes home cooking over the convenience of restaurant delivery.
Also that day, shares of Stitch Fix, which is seen in some ways as a peer of Blue Apron's -- both companies ship products, sometimes on a subscription basis, directly to the consumer -- crashed on weaker-than-expected customer growth. Because active customer growth is key for both companies, that may have also weighed on Blue Apron stock.
Finally, supermarket chains have made considerable advances in e-commerce, making pickup and delivery more widely available. Amazon.com has rolled out Whole Foods delivery on Prime Now to over a dozen metro areas, and Walmart today scored an upgrade from Deutsche Bank, which said the retail giant is well positioned to gain market share in groceries as Walmart is expected to have about 2,000 grocery pickup stations operating by the end of the year. The upgrade is a reminder that traditional grocers are continuing to a chip away at what was once a clear advantage of meal-kit services-convenience and delivery.
Blue Apron shares closed at $1.38, within a penny of its all-time low, which it set last week. Meal-kit services are plagued by weak subscriber retention; less than 20% stick with services such as Blue Apron for more than six months, according to research firm Second Measure. Between that and the ample competition in the industry, it's not surprising to see the stock drifting lower. Investors may be hoping for a turnaround in its next earnings report in a few weeks, but at this point there seems little reason to bet on the company's long-term success.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Jeremy Bowman owns shares of Stitch Fix. The Motley Fool owns shares of and recommends Amazon and Stitch Fix. The Motley Fool has a disclosure policy.