HelloFresh - The Best Meal-Kit Company Out There?
Dear investors,
Welcome back to Thursday’s free newsletter, where we discuss investable assets by their history, current and future outlook with technical analysis.
In this week’s newsletter we will talk about the popular food delivery service HelloFresh. With Covid, people are spending more time in the kitchen than ever before to try out new sorts of meals and we believe HelloFresh is currently benefitting from it bigly.
At the end of this newsletter you will know what the company is about, information about their latest quarterly earnings statement and if its worth considering a mid to long-term investment.
Topics we will discuss are:
HelloFresh Explained
Quarterly Statement Q3
Technical Analysis
Conclusion
HelloFresh Explained
HelloFresh is a German publicly traded meal-kit company what delivers fresh food for a whole household or just for one person.
HelloFresh's business model is to prepare the ingredients needed for a meal, and deliver them to customers, who must then cook the meal using recipe cards, which takes around 30–40 minutes. It generally provides about three two-person meals a week for about $60 to $70. It offers a choice from about 19 recipes. In the United States, HelloFresh offers a wine-subscription service, based on that of its competitor Blue Apron. In several markets, it provides "Rapid Box" meals which take only 20 minutes to prepare. In March 2018, HelloFresh announced their acquisition of Green Chef, the USDA-certified organic meal kit company. HelloFresh offers the largest selection of meal plans for consumers, adding Green Chef's popular organic vegan and gluten-free menus, including those plans compliant with Paleo and Keto diets
The company operates in the United States, Australia, Denmark, Sweden, Canada, New Zealand, UK, Luxembourg, Belgium, France, the Netherlands and of course Germany.
HelloFresh been listed on the Frankfurt Stock Exchange since its IPO in November 2017.
Quarterly Statement Q3
Here is quick summarise of the third Quarterly Statement this year, published on November 1.
HelloFresh delivers strong performance in Q3 across both segments:
Active customers of 6.94m, a 38.8% growth compared to the third quarter 2020.
Continued strong customer engagement, with a year-on-year increase in average orders per customer in Q3 2021, despite a more normal seasonality this year.
Average order value up year-on-year to EUR 51.3, driven by the US segment.
Q3 revenue of MEUR 1,415.5m, a year-on-year growth of 45.9% on a euro basis; and 44.9% on a constant currency basis. (MEUR = Million EUR)
Technical Analysis
HelloFresh — Daily Chart
At the moment of writing, HelloFresh’s stock ($HFG) is trading at around $100 and is rising rapidly because excellent Q3 earnings release.
If someone recently entered a position at the second trend line from below, he would have already 30% in gains. Because we are late to the party as well, we are seeing two potential scenarios to enter positions in the near future:
If this rapid increase in price continues and breaks the local trend line what is acting as resistance. We wait for a potential retest on the same line to see if it is strong enough to act as a new support. If $HFG holds that line and is going up again, we would enter positions.
With the already aggressive run over the last days, we may see price exhaustion sooner or later of a short amount of time. If $HFG gets a reaction on the local trend line what is acting a resistance, but is getting rejected, we would wait for a reaction on the potential support at around $92 (first all-time high since 2021).
HelloFresh — Weekly Chart
If we zoom out to the weekly chart, we can see that the technical indicators are both at acceptable levels. If the MACD is curling back up towards the signal line (back to bullish momentum) and the price is above the local trend line. We believe we could see another price swing towards $130.
Conclusion
HelloFresh, a relatively new company with still a lot of growth potential. In the years to come we at Patellic believe the company has more in its sleeve to attract more people to join their still expanding meal-kit service and expect HelloFresh to be a decent long-term investment.
We believe when Covid is finally behind us people are still taking the time to make fresh dishes, what they likely are ordering at HelloFresh because of the great service and strong brand name they have created.
We would like to thank you for your time reading our newsletter, if you found something interesting, consider to subscribe and share this newsletter with your friends. We would highly appreciate it!
Never mis out on big market news by following us on Facebook, Instagram or Twitter.