Our interviews with 300 restaurant partners resulted in a conviction sell recommendation on online food delivery app Just Eat whose shares dropped more than 40% in the following six months
In early 2018, Woozle released a conviction sell recommendation on Just Eat following reports of significant long-term headwinds that suggested a high probability of material under-performance in the medium-term and a negative sequential shift in the investment case in the near-term. Our team of equity analysts completed more than 300 interviews with restaurant partners and online delivery experts to gain an insight into their order volumes, profitability, market share by platform, ROI by delivery partner, and future partnership intentions. We were able to compile an early read on the disruptive trends in the industry revealing the true scale of increased competition, margin compression, and higher capex requirements on the prospects for the share price. Just Eat shares went on to drop more than 40% following our sell recommendation and the stock continues to trade below it’s historical peak.