What happened

Shares of Blue Apron Holdings Inc. (NYSE:APRN) fell again today in its third volatile trading day in a row as investors continue to debate the effects of the intrusion of Walmart and Weight Watchers in the meal-kit space. After slipping 17% last Thursday and then gaining back 11% on Friday, the stock was down another 4.7% today as of 12:23 p.m. EDT.

A sample box from Blue Apron containing various vegetables and a pack of noodles.

Image source: Blue Apron.

So what

The volatility shows just how weak Blue Apron's prospects appear to Wall Street as the stock is now trading nearly 80% below its $10 IPO price last year. Competition is taking away market share from the leading meal-kit provider, with Hello Fresh quickly nipping at its heels and Amazon-Whole Foods seen as a potent threat. However, last week's news that both Walmart and Weight Watchers would begin selling meal kits in grocery stores shows that the delivery model pioneered by Blue Apron may be upended by meal kits in supermarkets at lower prices. Walmart's meal kits will be available for as low as $4 per person, compared to a typical price of $9.99 for Blue Apron.

Now what

After Blue Apron's revenue tumbled in its most recent quarter, it's clear that the company has problems beyond competition. While margins should improve as its new Linden, New Jersey, facility is now operating more efficiently, analysts still expect revenue to decline this year. For a company that was supposed to be a fast-growing start-up, that is unacceptable to investors. Unless some good news emerges, I'd expect Blue Apron shares to keep sinking as competition will only increase.

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