The stock price of GrubHub Inc (NYSE:GRUB) jumped up $2.35 to close at $36 on Friday (up 6.98%) on Friday. It jumped nearly 11% near lunchtime yesterday. Why?
Priceline Group Inc (NASDAQ:PCLN) acquired OpenTable Inc (NASDAQ:OPEN) for $2.6 billion yesterday.
OpenTable was bought at nearly a 50% premium from its closing price on Thursday. GrubHub is currently valued at around the same price as OpenTable at around $2.8 billion.
OpenTable helps users that want to sit down at a restaurant at a certain time. GrubHub helps its users get restaurant deliveries that do not typically deliver meals. GrubHub is new to going public as its IPO was two months ago.
GrubHub’s forward P/E of 200 is almost three times OpenTable’s forward P/E of 75 after the acquisition, according to Fool.com.