UPDATE: Barrington Initiates Coverage On GrubHub Inc

In a note released Thursday morning, Barrington Research analyst Jeff Houston initiated coverage of GrubHub Inc (NYSE: GRUB) with a Market Perform rating, but has yet to set a price target.

Despite the sentiment that "GrubHub is revolutionizing takeout dining," Houston believes a Market Perform rating is justified due to valuation/multiple compression risk, the expiration of share lockups on October 1 and December 3, and "seasonally-weak" results ahead for the third quarter.

As a possible catalyst, Houston pointed to support from chain restaurants and a possible partnership with Uber or Lift.