JPMorgan Cazenove has raised its price target for Just Eat PLC (LON:JE. a day after the online takeaway firm’s promotion to the FTSE 100 was confirmed in the latest indexes reshuffle.
In a review of the European takeaway sector, the US bank, which initiated coverage on Just Eat's rivals Delivery Hero and Takeaway.com, reiterated an ‘overweight’ stance on the UK firm with an increased price target of 967p, up from 841p previously.
READ: Just Eat gets unconditional approval for Hungryhouse merger
In midday trading today, Just Eat shares were changing hands at 794.5p each, down 0.5% or 4p on last night’s closing price.
JPMorgan’s analysts said Just Eat remains a key pick in its European Media coverage but they pointed out that all three players under its coverage are benefiting from strong industry dynamics.
They added: ”This is clearly a volume game and the economics are improving fast - US peer GrubHub - moved early also into delivery and sees similar unit economics between the two models. We see a similar outcome for the European names.”
Just Eat’s elevation to the UK blue chip index comes after, earlier this month, it was given the provisional green light by regulators to complete its £240mln takeover of rival Hungryhouse.
Alongside Just Eat, packaging firm DS Smith PLC (LON:SMDS) and engineering group Halma PLC (LON:HLMA) will also be promoted into the FTSE 100 index following the latest quarterly indexes review.
Moving the other way, down to the FTSE 250 index, are medical products firm ConvaTec Group PLC (LON:CTEC), London Eye operator Merlin Entertainments PLC (LON:MERL), and contractor Babcock International PLC (LON:BAB).