Just Eat (GB:JET) announced in its third-quarter trading update that the company has returned to profitability – ahead of its expectations.
The profits were driven by continuous cost-cutting efforts.
The total value of the company’s orders increased by 2% because of higher prices and favourable foreign exchange movements. The company’s efforts to revive profitability also paid off as the company posted positive earnings (EBITDA), slightly more than guidance issued earlier.
The total orders processed were 235 million, which fell by 11% compared to the third quarter of 2021.
Rising inflation has led to customers cutting their spending.
Sreedhar Mahamkali, an analyst at UBS, said, ‘We believe overall that this is an in-line set of numbers and expect a neutral reaction. Comments on the call on exit rate into Q4 and any expectations of growth into FY23 could be important.’
Mahamkali has reiterated his Buy rating on his stock today.
The results came as a relief for the company, which was under tremendous pressure from investors after the stock lost more than 75% of its value in the last year.
The shares gained more than 3% during the day after the announcement.
Is Just Eat Takeaway stock a buy?
According to TipRanks’ analyst consensus, Just Eat Takeaway stock has a Moderate Buy rating.
The JET target price is 2,324.5p, which has an upside potential of 73.42% from the current price level.
Conclusion
The company’s commitment to its initiatives helped it post profits ahead of the expected timeline. The cost-of-living crisis poses a threat to the company’s orders; however, the company said it was “well-positioned” to achieve its next targets.
