Interactive Investor

ii view: Just Eat Takeaway orders surge under Covid

13th January 2021 11:44

Keith Bowman from interactive investor


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The pandemic push may not last indefinitely but a move into the US cannot be ignored.

Fourth-quarter 2020 trading update

  • Order growth of 57% year-over-year

Chief executive Jitse Groen said:

"The fourth quarter of 2020 marks our third consecutive quarter of order growth acceleration. Our investment programme is very successful and has led to significant market share gains in most of our countries. 

"In 2021, we will continue to invest in price leadership, improving our service levels and expanding our offering to restaurants and consumers."

ii round-up:

Online food ordering company Just Eat (LSE:JET) reported a 57% jump in orders received compared to the last quarter of 2019, as a retightening of lockdown restrictions left consumers unable to eat out. 

Total orders year-over-year for the UK and Germany rose by 58% and 56% respectively. Management expects full-year revenue growth across the company of more than 50%.

Just Eat shares fell by more than 4% in UK trading, leaving them up by around 50% since late March pandemic lows. Shares for supermarket delivery company Ocado (LSE:OCDO) have doubled during the same time frame. 

Early in 2020, Just Eat and Dutch company combined under a £6 billion deal. In June, it launched a deal to buy US business GrubHub (NYSE:GRUB) in an all-share transaction which is currently expected to complete in the first half of 2021.

The latest period marks the now Amsterdam headquartered company’s third consecutive quarter of order growth acceleration. Total orders for the prior third quarter grew by 46%. 

Its technology platform connects over 200,000 restaurants to consumers. It mainly collaborates with delivery restaurants, but also provides its delivery services to restaurants that do not deliver themselves. The UK sales force has doubled year-over-year. 

UK delivery orders jumped to 14.2 million in the latest quarter from 2.9 million in the last quarter of 2019. Ongoing investment in its key countries has underpinned growth both in marketplace orders as well as in its delivery business.

When allowing for costs under the coming together of Just Eat and, the combined company previously reported a first half loss of €158 million.

Full-year 2020 results are likely to be released in mid-February.

ii view:

The combined Just Eat competes with global rivals such as Uber Eats (NYSE:UBER), Deliveroo and Delivery Hero (XETRA:DHER). It has operations in countries including the UK, Germany, the Netherlands, Canada, Australia and others, along with partnerships in both Colombia and Brazil.    

For investors, competition across the industry continues to strengthen and intensify. In 2020, Uber Eats purchased US food delivery company Postmates in a $2.65 billion deal. Deliveroo, in which Amazon (NASDAQ:AMZN) previously acquired a share stake, has only recently announced plans to expand its footprint to cover 100 more towns and cities across the UK this year.

But Just Eats’ coming together with, and potentially Grubhub in the not too distant future, creates a food delivery company truly on the global stage. Together with Grubhub, it processed approximately 593 million orders in 2019 with more than 70 million combined active consumers globally. For now, while some near-term caution looks sensible given a likely slowing in post pandemic growth, shareholders are likely to remain optimistic. 


  • A potential combination with Grubhub moves it into the USA
  • A beneficiary of the pandemic & population lockdowns


  • Intensifying competition - Amazon has an interest in Deliveroo
  • An estimated price earnings ratio of around 200

The average rating of stock market analysts:

Strong hold

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