Delivery Hero SE (DE:DHER) is a global delivery platform that provides food, groceries, and other household items in over 70 countries. The company partners with around 500,000 restaurants worldwide and connects them with customers.
The company’s stock has lost 60% of its value in the last three years. Despite its dismal performance, analysts are evaluating its long-term potential and hold the belief that it will emerge from its current downward trend in its share price.
Let’s take a look at the details.
Improved Projections
The company predicted its gross merchandise value (GMV) to increase by 5-7% in 2023. It referred to this as a “promising start” and expects the growth rate to surge throughout the year. For the first quarter of 2023, the company posted a GMV of €11.2 billion, which reflected an increase of 2.1% and was in line with analysts’ expectations.
A key bullish factor for the company is its robust geographical diversification, boasting a significant presence in emerging markets. Analysts perceive this as a substantial opportunity for the company to capitalize on the high-growth food delivery market in these regions, such as Asia. The company expects to post double-digit growth in Asia in 2023 after posting a decline of 7% in its GMV in the region in Q1 2023.
Analysts’ Opinion
Overall, analysts believe the company is on the right track as it shifts its focus from growth to profitability.
Today, Giles Thorne from Jefferies confirmed his Buy rating on the stock, predicting a huge upside of almost 150% in the share price. Three days ago, he reduced his price target from €90 to €87. Thorne puts Delivery Hero among his top three picks among the European food delivery companies.
16 days ago, Morgan Stanley’s analyst Miriam Josiah also reiterated her Buy rating on the stock, projecting 52% growth from the current trading level.
Delivery Hero Stock Forecast
DHER stock has a Strong Buy rating on TipRanks, with a total of 13 recommendations, of which 11 are Buy.
At an average price forecast of €63.72, analysts are predicting more than 82% growth in the share price.
Conclusion
Following a substantial decline in the share price and loss of market capitalization, Delivery Hero appears to be on a more favorable trajectory. Analysts believe that the company’s expansion into emerging markets will positively impact its profitability and drive an improvement in its share price.
