Symbotic (NASDAQ:SYM) shares moved lower on Tuesday, slipping 4.9% to $81.15 in pre-market trading after Goldman Sachs shifted to a bearish stance on the warehouse automation company, assigning a Sell rating and a $47 price target.
Goldman Sachs analyst Mark Delaney downgraded Symbotic from Neutral, warning that the company’s dependence on a limited customer base and uncertainty around future cash generation pose meaningful risks. His new target implies a potential 44.9% decline from Monday’s $85.30 close.
Delaney acknowledged that Symbotic’s automation platform continues to resonate with Walmart, which has ordered systems for all 42 of its U.S. regional distribution centers. However, he emphasized that the company has struggled to bring in new independent customers over the past few years.
A central issue behind the downgrade is Symbotic’s heavy reliance on GreenBox, the joint venture it established with SoftBank’s SPAC sponsor. Roughly half of Symbotic’s $22.5 billion backlog—about $11.6 billion—is tied to sales through this JV, which is 35% owned by Symbotic and 65% by SoftBank.
According to Goldman Sachs, shipments to GreenBox may generate only modest upfront cash flow, as Symbotic can satisfy its 35% funding obligation either with cash or by forfeiting margin on those system deliveries. This dynamic could cause cash flow growth to lag behind adjusted EBITDA gains.
Delaney further noted that GreenBox has not signed any third-party customers more than two years after its launch, calling the setup “the type of circular transaction that investors are increasingly scrutinizing.”