(New: Third paragraph on short sellers, share price development updated.)

FRANKFURT (dpa-AFX Broker) - A surprisingly good earnings outlook from Delivery Hero only briefly boosted the recently badly shaken shares on Monday. The share price quickly turned negative. The focus remained on the group's balance sheet risks, explained analyst Jo Barnet-Lamb from the major Swiss bank UBS.

After rising by up to a good eleven percent, the share price fell just as rapidly to minus ten percent, to a record low of 14.92 euros. In the early afternoon, the shares were down 1.3 percent at 16.43 euros.

One trader attributed the sharp rise in the share price at the start of trading to suspected covering purchases by short sellers. These are speculators who bet on falling share prices. Some of them could have cashed in after the recent slump and the Group's earnings outlook. Others could also have been caught on the wrong foot by the earnings outlook. When short sellers reduce or close out their positions, they buy shares, which can drive the share price higher and higher. If this demand disappears, the price can quickly fall again.

It had already fallen by almost 23 percent on Friday. The price slide was triggered by a report in the "Business Times" from Singapore, according to which a deal to sell parts of the Foodpanda business in South East Asia to Grab Holdings fell through due to differing price expectations. Although Delivery Hero stated that the rumors were false, this did little to help the share price in the end. There is now uncertainty as to when the Group will receive money from the hoped-for sale.

A sale would significantly improve the company's finances, making the shares more interesting again for many investors, explained analyst Giles Thorne from investment firm Jefferies. If the sale were to fall through, it would therefore be a major disappointment.

At the start of the week, the focus shifted to the latest business figures. The management of the MDax group is forecasting earnings before interest, taxes, depreciation and amortization (EBITDA) adjusted for one-off effects of EUR 725 to 775 million for 2024. This is more than analysts are expecting on average. Segment sales for 2023 also exceeded the consensus estimate.

Analyst William Woods from Bernstein Research also positively emphasized that Delivery Hero reached the free cash flow (FCF) break-even point in the second half of 2023. The company is aiming for positive FCF in 2024. In addition, the gross merchandise value is expected to increase by 7 to 9 percent compared to the previous year, which is "a strong outlook" according to Woods.

UBS analyst Jo Barnet-Lamb was also positive about the Group's outlook, although he did not find it particularly surprising. Nevertheless, he pointed out that Delivery Hero's transition to profitable growth is progressing as planned.

However, according to Barnet-Lamb, an above-average share price performance seems unlikely until the concerns regarding the balance sheet, i.e. the company's financial strength, are resolved.

The share price has been on a downward trend for some time. In 2017, the company went public at an issue price of 25.50 euros per share. During the coronavirus pandemic, it then reached a record high of just over 145 euros at the start of 2021. People were barely able to eat in restaurants and ordered a lot from delivery services. At the time, Delivery Hero was worth EUR 39.5 billion on the stock exchange and the stock was even temporarily listed on the DAX.

However, the share price then fell sharply, especially from the end of 2021. In 2022, it slumped by 54%, and in 2023 by a good 44%. The current market value is still just under 4.5 billion euros./mis/tih/men/ck/men