What: Shares of online food order and delivery company GrubHub (NYSE:GRUB) sank more than 20% today after its quarterly results and outlook disappointed Wall Street.

So what: GrubHub shares have slumped sharply in recent months on concerns over increased competition, and today's Q3 miss -- adjusted EPS of $0.13 missed the average analyst estimate by $0.01 -- coupled with downbeat guidance only reinforces those concerns. While revenue for the quarter jumped 38% to $85.7 million, operating expenses soared a whopping 47.2%, suggesting that it's becoming increasingly expensive for GrubHub to maintain its competitive moat against new threats posed from the likes of Amazon. 

Now what: Management now sees Q4 revenue of $98 million-$100 million, missing the consensus view of $100.84 million. "While delivery volume remains low relative to overall volume on GrubHub, we've seen tangible improvements in diner frequency, order growth and conversion in some of our secondary markets where restaurants we deliver for generate a significant amount of the overall order volume," said CEO Matt Maloney. "This gives us confidence that our investment in delivery will reap rewards across our entire network over time." When you couple GrubHub's increasingly fierce competitive landscape with its lofty 50-ish P/E, however, I'd hold out for a wider margin of safety before buying into that optimism.