Shares of GoodRx (GDRX) are on the rise on Thursday after RBC Capital analyst Mark Mahaney upgraded the stock to a Buy-equivalent rating as he believes the pullback in the shares following the news of the Amazon (AMZN) Pharmacy launch was an over-reaction. The stock has been in the spotlight this week after the e-commerce giant announced two new pharmacy offerings - Amazon Pharmacy, a new store on its platform, and an Amazon Prime prescription savings benefit. Citing Amazon risk, both JPMorgan and Morgan Stanley cut their own ratings on GoodRx shares this week, with the former saying the company will be "materially impacted" by the new offerings and the latter arguing that having Amazon as a direct competitor could translate to slower member growth.

PULLBACK 'AN OVER-REACTION': RBC Capital analyst Mark Mahaney upgraded GoodRx to Outperform from Sector Perform with an unchanged $56 price target. The analyst sees the 28% pullback in the stock price on the news of the Amazon Pharmacy launch as an over-reaction. Further, Mahaney argues that his recent talks with the management, as well as his own research, suggest "some nuances" to the Amazon program and to "retail Pharma as a whole," which should reduce the long-term competitive impact for GoodRx. He expects GoodRx to remain the leading player in the "discount card space."

AMAZON RISK: On Wednesday, Morgan Stanley analyst Ricky Goldwasser downgraded GoodRx to Equal Weight from Overweight with a $36 price target, down from $57. Noting that GoodRx sold off on Amazon's entry into the prescription cash discount market, the analyst told investors she views the stock's risk/reward as more balanced. Having Amazon as a competitor would likely cap its multiple, she added. While Goldwasser acknowledges that Amazon’s move serves as yet another validation of the GoodRx model, she believes having Amazon as a direct competitor could translate to slower member growth, require higher marketing spend, and could limit the upside optionality.

Even more bearish on the name, JPMorgan analyst Doug Anmuth downgraded GoodRx to Underweight from Neutral with a $29 price target. The analyst told investors that he believes GoodRx could be "materially impacted" by Amazon Prime Rx, the new discount card program that competes directly with the core GoodRx prescription transaction offering. While Anmuth thinks the near-term impact from Amazon's offerings may be limited, he believes Amazon Pharmacy will be positioned as an important benefit of Prime and sees direct risk to GoodRx over the next few years.

PRICE ACTION: In Thursday morning trading, shares of GoodRx have jumped almost 10% to $37.12.