We will be hosting a Black Book institutional presentation Wednesday, September 26, 2018 at 10:00AM ET to discuss our Global Restaurant Delivery call. Email sales@hedgeye.com for access.
The global delivery market is dominated by a handful of participants, with a few dozen smaller competitors trying to nip at their heels. Over the next few years, we believe there will be a global shakeout, as certain players combine to create more scale and synergies, while smaller players die off as the cost to compete gets too expensive.
We will be discussing the following companies in our presentation:
- Grubhub (GRUB): Best Idea LONG
- Just Eat (JE-GB): Best Idea LONG
- Takeaway.com (TKWY-NL): Elevating from LONG bench to Best Idea LONG
- Delivery Hero (DHER-DE): Adding to our LONG bench
Despite the price appreciation in these stocks over the last few years, especially for GRUB, we believe they represent great opportunities to get LONG the greatest disruptor the restaurant industry has ever seen.
There is a massive global addressable market that has yet to be truly defined. We view these players as the long-term winners and likely M&A participants as the industry looks to consolidate.
Beyond our calls on the delivery providers themselves, we will also be digging into the effect this growing industry will have on the restaurant industry, both on the top-line as well as from a profitability standpoint. A restaurant is required to pay a 25% to a 30% commission on a delivered order, while the consumer pays a $2 to $5 delivery fee on top of a suggested tip, which combined will pull billions of discretionary dollars from consumer wallets.
We suspect delivery will be a long-term negative for the casual dining industry.
BLACK BOOK TOPICS WILL INCLUDE BUT ARE NOT LIMITED TO:
- Mapping of key players in top delivery markets
- Discussion on the incrementality of delivery
- Analysis on each delivery player
- Smaller private competition
- M&A deals and capital raises
- Third party aggregator effect on chain restaurants - SHORT casual dining
