Delivery Hero SE (ETR:DHER) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Delivery Hero SE offers online food ordering and delivery services. On 31 December 2023, the €5.5b market-cap company posted a loss of €2.3b for its most recent financial year. Many investors are wondering about the rate at which Delivery Hero will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Delivery Hero

Consensus from 17 of the German Hospitality analysts is that Delivery Hero is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of €146m in 2026. Therefore, the company is expected to breakeven roughly 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 90% year-on-year, on average, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Underlying developments driving Delivery Hero's growth isn’t the focus of this broad overview, though, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with Delivery Hero is its debt-to-equity ratio of over 2x. Typically, debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Delivery Hero which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Delivery Hero, take a look at Delivery Hero's company page on Simply Wall St. We've also put together a list of essential aspects you should further examine:

1. Valuation: What is Delivery Hero worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Delivery Hero is currently mispriced by the market.

2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Delivery Hero’s board and the CEO’s background.

3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.