Deliveroo PLC (LSE:ROO) is expected to return around £250 million to investors over 2024, analysts at Jefferies believe.
The delivery company is expected to have a closing net cash balance of over £700 million by the end of the current financial year.
However, this figure is likely to drop to £340 million when considering the £170 million set aside for legal provisions and the maximum of £200 million saved for contingent liabilities.
Another £50 million has been reserved for share buybacks to cover any compensation owed to employees.
Jefferies analysts think that Deliveroo will close with a cash balance of around £300 million and will launch a £250 million return of capital in the coming year (either through share buybacks or dividends).
Deliveroo shares rose over 44% in the last twelve months but Jefferies is still confident they can go higher.
The New York investment bank thinks Deliveroo is well-equipped to take advantage of a rise in cross-border mergers and acquisitions in the future.
Based on this and the fact it operates with strong fundamentals, Jefferies has reiterated its ‘buy’ rating.
Shares in Deliveroo currently trade at around 128p.