American investment bank Citi has increased its price and earnings targets for Deliveroo PLC (LSE:ROO) and Just Eat Takeaway.com NV (LSE:JET, NASDAQ:GRUB) following better-than-expected fourth-quarter trading updates from the two listed food delivery companies.
It remains a ‘buyer’ of the latter up €29 a share, an increase of €1 on its original price target, while it keeps its ‘neutral' call on the former, but increased its valuation by 10p a share to 90p.
Citi thinks it will be harder for both to grow in 2023 because of the tough economic backdrop.
For Deliveroo, it is forecasting a 1% decline in order growth but a 5% increase in gross transaction value (GTV) for 2023. Turning to Just Eat Takeaway, it expects order growth to recede by 2% and GTV to nudge 1% lower.
Deliveroo 2023 EBITDA is forecast to be £48mln, compared to our previous estimate of just £4mln.
Just Eat Takeaway's 2023 EBITDA forecast is €260mln, compared to Citi’s previous target of €222mln and guidance of around €225mln.