HelloFresh: Upside Possible, But Results Don't Justify This

Summary

• HelloFresh's recent 50% stock uptick is sentiment-driven, not justified by fundamentals, with revenue growth at 0.9% and declining meal kit volumes.
• HELFY faces challenges with customer acquisition, high marketing expenses, and competition in the Ready-To-Eat segment, which has lower margins.
• Rising SG&A expenses and negative EBIT and net income indicate profitability issues, making HelloFresh a risky investment despite its large revenue base.
• I rate HelloFresh as a "hold," only considering investment at around €2/share due to significant challenges and competition.
• Looking for a helping hand in the market? Members of iREIT®+HOYA Capital get exclusive ideas and guidance to navigate any climate. Learn More »

Jarretera

Dear readers/followers,

I actually enjoy following up on companies and theses/articles where I as an analyst didn't do a good job. By this, I mean that the company went a different way than I believed it would, even if I thought at

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

While this article may sound like financial advice, please observe that the author is not a CFA or in any way licensed to give financial advice. It may be structured as such, but it is not financial advice. Investors are required and expected to do their own due diligence and research prior to any investment. Short-term trading, options trading/investment and futures trading are potentially extremely risky investment styles. They generally are not appropriate for someone with limited capital, limited investment experience, or a lack of understanding for the necessary risk tolerance involved. I own the European/Scandinavian tickers (not the ADRs) of all European/Scandinavian companies listed in my articles. I own the Canadian tickers of all Canadian stocks I write about. Please note that investing in European/Non-US stocks comes with withholding tax risks specific to the company's domicile as well as your personal situation. Investors should always consult a tax professional as to the overall impact of dividend withholding taxes and ways to mitigate these.