Here’s Why Grab Holdings Ltd. (GRAB) Crashed on Wednesday

We recently compiled a list of the 10 Firms Defy Wednesday’s Broader Market Optimism. In this article, we are going to take a look at where Grab Holdings Ltd. (NASDAQ:GRAB) stands against the other stocks.

Wall Street extended its winning streak on Wednesday, with all of its main indices closing in the green territory, as investors seemed to have already factored in the news of tariffs imposition alongside uncertainties surrounding the Artificial Intelligence industry.

The Dow Jones gained another 0.71 percent, the S&P 500 grew 0.39 percent, and the tech-heavy Nasdaq increased by 0.19 percent.

Ten companies, however, defied a broader market optimism, mostly due to disappointing earnings results. This article details the reasons behind the drop in their share prices and latest earnings performance.

To come up with Wednesday’s biggest losers, we considered only the stocks with at least $2 billion in market capitalization and $5 million in daily trading volume.

A customer enjoying the convenience of a mobile financial services transaction.

Grab Holdings Ltd. (NASDAQ:GRAB)

Grab Holdings’ shares tumbled 10.76 percent to end at $4.56 apiece on Wednesday as investors resorted to profit-taking following gains in the previous trading, while also reacting to a recent downgrade in the company’s rating outlook.

On Wednesday, analysts from JP Morgan downgraded Grab Holdings to “neutral” from “overweight” but maintained a price target of $5.6 apiece.

According to JP Morgan, now suggests a good time for investors to book profits. However, they warned that conservative fiscal year 2025 guidance could temper bullish expectations in the near term.

Recently, reports surged that Grab was taking over one of its competitors, GoTo, for a potential takeover of the latter for $7 billion.

A new round of merger talks was said to have occurred in December 2024, with the two parties eager to officially strike a deal this year.

A report by Reuters citing sources privy to the matter said that an agreement could still be axed as previous negotiations all fell through.

Overall GRAB ranks 3rd on our list of Wednesday’s top losers. While we acknowledge the potential of GRAB as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than GRAB but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.

Disclosure: None. This article is originally published at Insider Monkey.