Jefferies analysts say shares in Dutch food delivery marketplace Just Eat Takeaway.com could more than double over the next 12 months. In a June 26 research note, the U.S. investment bank set a target price on the stock at 25.5 euros ($27.62), representing a potential upside of 125.9% from the July 4 closing price of 11.29 euros. Rui remains bullish on Just Eat, even though the company’s U.S. business Grubhub has faced pressure from governments to impose price controls on restaurants since the Covid-19 pandemic. Grubhub wrote in an August 2022 blog post that while the purpose of price controls is to “allow restaurants to obtain delivery, marketing and other services at artificially low prices,” the actual impact is “very different.” “Price controls severely limit the ability of local restaurants to promote business, find new diners, attract repeat customers, and send more orders,” the report said. Jefferies analyst Giles Throne pointed out that in September last year, a U.S. federal court upheld GrubHub and Uber’s Platforms like DoorDash have the right to sue New York City over fee caps, adding that new policies may be on the way. “The fee cap issue puts a long-impacted sale of part or all of Grubhub in limbo; resolution of the issue should create momentum for potential high-equity active asset sales,” he wrote. Throne believes there is still a high-quality total market in the business “Pockets” of value, particularly in New York City, where he assessed the city’s EBITDA to be “mispriced.” According to a Jefferies report, Just Eat expects the revised fee cap to have an EBITDA impact of $100 million. Throne said this was “very important to profitability” given the company’s full-year 2024 adjusted EBITDA guidance of about 450 million euros. TKWY-NL Year-to-date Just Eat share price movement Attention was focused on food delivery platforms such as Just Eat during the height of the Covid-19 pandemic, when countries around the world implemented social distancing restrictions that curbed dining in restaurants event venue. The easing of these restrictions, coupled with rising food inflation, has forced some players to exit markets in which they do not dominate. Just Eat is also feeling the pressure, with total orders falling to 214.2 million in the first quarter from 227.8 million in the same period last year. The delivery company’s shares are also off their COVID-19 highs, down 18.1% year to date and 22.5% over the past 12 months. Just Eat is listed on Euronext Amsterdam and the London Stock Exchange. It also trades as American depositary receipts in the U.S. — CNBC’s Michael Bloom contributed to this report.
