On Tuesday, Delivery Hero shares continued their recent recovery after the price slump in the previous week. In the stock market environment, which was friendly again, investors also grabbed other German online stocks.
The papers of the delivery service Delivery Hero slipped below 40 euros on Monday for the first time since October 2019, before a recovery began on the same day. On Tuesday, there was a temporary increase of 12.04 percent to EUR 48.48 – the shares secured first place in the leading German index DAX. The news that co-founder and company boss Niklas stberg had acquired shares in Delivery Hero worth almost 14 million euros last Thursday also helped.
When a CEO buys stock in their own company, it’s usually a reassuring sign for other shareholders. Such a step is intended to strengthen trust in the company.
On Thursday, the food delivery service shocked investors with a gloomy outlook and caused severe turbulence in the course, but the share certificates could have found their bottom at EUR 40 for the time being. Credit Suisse wrote on Tuesday that the price slump of more than 40 percent within a few days was exaggerated – and stuck to its positive vote for the shares.
According to Credit Suisse analyst Joseph Barnet-Lamb, the heavy investments in Spanish delivery service Glovo are putting Delivery Hero’s balance sheet in the spotlight. The group wants to have taken over Glovo completely by the second quarter. The concerns resulting from the announcement of high investments for Glovo overshadowed the encouraging annual targets for the core business, which should break even in the current year.
After an investor event, analyst Marcus Diebel from the US bank JPMorgan also maintained his optimistic assessment of Delivery Hero shares. The delivery service’s management admitted to having underestimated the market’s focus on the refinancing, but clearly stated that they would address concerns in this regard very quickly. The prospects for structural growth are there – but the management now has to keep its promises regarding short-term refinancing.
Looking at other comparable stocks, the shares of the meal kit supplier HelloFresh gained 3.6 percent in the DAX, while the leading German index rose by 1.3 percent. In the also fixed MDAX of medium-sized stocks, the shares of the used car dealer AUTO1 rose by 3.9 percent after falling to a record low at the beginning of the week.
In the SDAX, Shop Apotheke shares gained a good five percent. The second-tier index was almost two percent up.
Brsians justified the gains in online stocks, which are very volatile and sensitive to the economy, with the brightened capital market environment, because there is a glimmer of hope in the Ukraine conflict: Russia says it has started withdrawing troops from the south and west of the country after manoeuvres.
The West had reacted with extreme concern to the Russian manoeuvres. The US fears that the troop movements and a deployment of tens of thousands of soldiers along the Ukrainian border are in preparation for war. Russia rejects this.
FRANKFURT (dpa-AFX)
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Image sources: Delivery Hero