Deliveroo PLC (LSE:ROO) kicked more than 5.5% higher this morning, continuing on from its strong performance yesterday when its shares rose by close to 11%.
Driving the share gains was Deliveroo's first-ever profit, with the delivery firm announcing earnings of £1.3 million in the six months to June, against a loss of £82.9 million in 2023.
A £150 million share buyback was also announced, with chief executive Will Shu noting the return to profit and positive cash flow marked “two major financial milestones,” coming in part on a “stabilising” consumer environment.
Also keeping the stock in flight was a bullish broker note from analysts at Deutsche Bank, who upgraded the group's price target from 180p to 187p after reiterating its 'buy' rating.
"Deliveroo reported solid results that we think keep the group on track to deliver midterm growth acceleration to low double digits and 4% adjusted EBITDA margin in 2026E," said Silvia Cuneo at the German bank.
"We raise our adjusted EBITDA forecasts in 2024E and outer years, albeit with slightly more conservative growth assumptions since macro contribution remains uncertain."
Cuneo also added that the new buybacks were "an extra plus".
Shares in Deliveroo are trading at close to 150p today, representing a close to 25% discount compared to DB's target price.