Shares of online grocer Peapod (Nasdaq: PPOD) fell 5/8 to 9-3/8 on Monday, but this could be a good time to take a close look at the stock. With rival online grocer Webvan set to go public, perhaps as early as this week, more and more people might be taking a look at Peapod’s valuation. Currently, Peapod is worth about $164 million, compared to Webvan’s whopping $4 billion pre-IPO value, and Webvan is at a much earlier stage of its development.
On Monday, Peapod announced that it had launched a new national service that makes 7,000 non-perishable grocery items, health-and beauty-care products, pet merchandise and other household goods available for shipping to customers in the 48 contiguous states. This might not seem like that big of a deal, but it’s also worth noting that Peapod offers comprehensive grocery shopping in eight markets already, while Webvan currently serves just one.
Webvan could well become the category-killer in this industry, but Peapod has a solid foundation and its stock looks rather cheap in comparison.