Just Eat Share Discussion Threads

[cabreado] 09/8/2015 18:38

This conversation is a bit déjà vu when money supermarket hit hard and rocketed and everyone thought insurers and travel companies were going to fight back and eventually leave the comparison site... Well that didn't happenJust Eat has a very strong future with fresh technology and a great database of providers and users. So lots of potential to keep growing.Some might consider shorting for now, but mid term this can go up easily another 30%

[hpcg] 09/8/2015 16:33

Thanks for the link. That is the primary question, what's in it for the restaurants? What do they suffer if leaving? The internet does not provide nearly the same value for customers of this industry; I don't need someone else's opinion on whether I like the food or not. I don't need google to tell me what is available i just need to walk around with my eyes open.

Either the JE tax has to go down or take away will leave.

[asagi] 09/8/2015 10:34

come on, what is this, a go-slow?

Published on Friday evening:
"Food-ordering websites like Just Eat could put us out of business, say high street takeaways"


Yawar Khan, the chairman of the Asian Catering Federation, told The Independent that the websites "were good for our members when it started as it would give a boost to their business, but now so many takeaways are on the platform, it is no longer a benefit, with many of the same customers returning, rather than new customers joining."...

Mr Khan, whose organisation represents 1,500 takeaways, said it was now encouraging its members to take control of their own online ordering systems by setting up their own websites in an attempt to undercut Just Eat and Hungry House and avoid the high fees.

Around one in ten of the comments on the article is of interest.

Asagi (short JE.)

[hpcg] 07/8/2015 19:30

Not quite the same thing, this is more the uncooked meal delivery, but VC is all over anything which delivers any type of food to people at home. VCs hand off to growth funds hence the money in here and Ocado.
As per the article margins are wafer thin and realistically this is the case for the internet ordering tax in the long term.

[mbmiah] 07/8/2015 18:46

Old mutual think it's great value

[nightyard] 07/8/2015 16:15

Consistent falls in spPeople realising it's not worth 2.7billion

[dangersimpson2] 06/8/2015 16:28

Yeah a fair few, GrubHub is market leader I think.

Lot's of capital flowing that way according to:

[lennonsalive] 06/8/2015 15:04

Is there a Just Eat in the US?

[asagi] 06/8/2015 13:39

it's even worse.

High aggregator commissions make the economics of a bespoke app even more favourable. Then the bespoke app is featured on till receipts, bags, menus...

Asagi (short JE.)

[dangersimpson2] 06/8/2015 12:49

Large independent companies like Domino's will always do better by having their own app/website ordering.

Just Eat are the largest of the rest not because they have been around longest but because they've spent the most on advertising & search optimisation. That's why there's not much operational gearing in the business. Over the last 2 years CoS is c10% and Admin Expenses 77% of Sales pretty consistently. The growth is impressive but if they continue to require those levels of advertising spend to drive it or keep market share then the company is significantly overvalued.

Pay 33x sales for menulog doesn't help either.

At this price shareholders have to be betting that when they have built market share then they can cut the advertising spend and generate much higher net margins. The problem is that then those high margins will then attract higher advertising spend by their competitors. Given that the underlying takeaway business is highly competitive and probably resents giving away margin to online orderers unecessarily (i.e. if it drives incremental business it is good but if it simply substitutes phone business it's not good) there will always be scope for a well capitilised competitor to take back market share imo.

[hpcg] 06/8/2015 12:36

And more importantly so do the balance of buyers and sellers at this time!

[asagi] 06/8/2015 12:35

sure hpcg - we agree. My point is that the result is

JustEat (but not pizza)

Asagi (short JE.)

[hpcg] 06/8/2015 12:10

Asagi - All the pizza chains have their own app - why wouldn't they? It just so happens Dominos is the most effective. Pizza is chain dominated whereas there are very few in Indian or Chinese; Masala Zone is the only one which springs to mind. It could actually be the delivery aggregators which kill JE because it makes delivery viable for the likes of Wagammama, Nandoes, Byron, even Zizzi. Almost any one actually. They would rather their "own" app than be lumped in with other vendors.

[asagi] 06/8/2015 11:52

don't forget - Domino's Pizza has its own app. I understand that this is third behind Just Eat and HungryHouse.

One wonders what effect the Domino's app has on JustEat and HungryHouse's pizza selling customers. I imagine it is something of a killer of companies that are on neither JustEat or HungryHouse. Trouble is, that without the JustEat commission, Domino's can make offers that the aggregators cooks cannot afford to.

Domino's could turn JustEat and HungryHouse into ex-pizza aggregators.

Asagi (short JE.)

[nightyard] 06/8/2015 09:47

Just eat has a market value of £2.7bilion.£2.7b for a company that uses such a replicable model.hungry house & new participants will eat away at JE market share Growth will fall on its face when market maturity is reached and profit warnings will follow.( would not surprise me if we saw amazon replicate just eat..they copied Groupon and others in the past)

[utsushi] 05/8/2015 20:02

nightyard,

I agree with you, apologies if I am repeating what has already been said.

Very good Interim results and a indifferent market reaction suggests the market shares your view-never a good sign when the share price falls on 62% EBITDA growth.
Say underlying EBITDA of £60m full year, gives a rough current EV multiple of 44x!
Its possible that the company could eventually grow into the valuation, with branches opening in Brazil/Mexico, and end up with a EV multiple of 15x, but most likely the problems of executing abroad, finding staff, competition, low barriers to entry, different takeaway dining habits, language/geographical issues etc., will mean that overseas cash flow contribution net of start up costs will be slow.
There is too much optimism in valuation, too little margin for error, even in the best of companies things tend to go wrong at some point.

[nightyard] 05/8/2015 15:11

I concur this is over valued

[undervaluedassets] 05/8/2015 11:23

The 35th most valuable stock in the 250 (?!)

Only 35 places away from a ftse100 listing !

There is growth here for sure .. but that is overcooked (do you see what I did there?)

[liquidkid] 05/8/2015 10:01

Going upmarket?

[undervaluedassets] 05/8/2015 08:29

Seems unkind of the market to sell these on good results

But i think the feeling is that the business is just too assailable.

"Hungry house" is certainly having a nibble. . . their app is also slightly less brown wrapper that JustEat's one.

(Never seen such a boring App presentation-wise)

[asagi] 04/8/2015 13:16

a 4% increase in average revenue per order. That suggests pricing pressure to me.

Asagi (short JE.)

[dangersimpson2] 04/8/2015 11:25

dropping rapidly now - can only think some broker is not impressed. These large cap story stocks tend to get moved around mainly by broker recs. Most brokers are positive since they want the investment banking business and a large company that is always doing corporate deals is a big prize. When one turns negative it usually signifies either they've missed out on all the deals or the company valuation is so far from reality that even they can't make a case any more!

[hpcg] 04/8/2015 10:18

Actually I'm back in short. Results were clearly not enough to impress the growth investors. I think we drift down here.

[lennonsalive] 04/8/2015 10:12

You could say that, but also they have the infrastructure, brand,etc

Still don't think they are worth near 3 billion, however not in a rush to short it.