Top 3 Food Delivery Stocks To Watch Due To The Covid-19 Pandemic
The market for food delivery stocks is probably sitting at the highest it has ever been at the moment. Food delivery applications were already increasing in user numbers and sales every year, as it is a new trend that has caught on. Many applications allow you to order from hundreds of local restaurants right to your doorstep. While yes, McDonald’s (MCD Stock Report) and Chipotle Mexican Grill (CMG Stock Report) have been performing well as traditional restaurants, it is partially due to these food delivery apps that exist.
In this new environment, people are much more comfortable with ordering food for delivery instead of going out to eat. Until there is a vaccine for the coronavirus this will continue to be the case. But will these top food delivery stocks fall once the pandemic is over? This isn’t likely, as food delivery services have already been rising in popularity in the last few years. While sales may go down, the services are still on the rise. So let’s look at three food delivery stocks that have taken advantage of the pandemic and have grown in 2020.
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Top Food Delivery Stocks To Watch In Q4 2020: Grubhub Inc.
First up on this list of food delivery stocks to watch is Grubhub Inc. (GRUB Stock Report). GrubHub is actively one of the largest food delivery companies in all of the United States. GrubHub actively has more than 20 million active users and 115,000 restaurants offering delivery or pickup using its app. GRUB stock price has been growing strong throughout 2020, all due to the pandemic and sales increases. GRUB stock did fall when the pandemic started but quickly caught up. Let’s talk about the recent news from GrubHub.
When GrubHub launched its second-quarter results, its gross food sales reportedly grew by 59% year over year to $2.3 billion. This was up from $1.5 billion the previous year. In addition to this great news, its revenue went up 41% year over year to $459 million.
Matt Maloney, the Founder, and CEO of GrubHub stated, “Our singular focus for the second quarter was to support our restaurant partners as much as possible in their time of need. With a little help from increased demand, we are proud to announce we were able to spend approximately $100 million supporting and keeping restaurants, drivers, and diners safe during these difficult times.”
As of October 9th, GRUB stock is at $74.50 a share on average. Grub stock started the year at $47 a share on average. That is why GRUB stock has made it to this list of food delivery stocks to watch.
Top Food Delivery Stocks To Watch In Q4 2020: Uber Technologies Inc.
Next up is Uber Technologies Inc. (UBER Stock Report) who you have surely heard of by now. The company now runs multiple applications that offer ride sharing, food delivery, and micro mobility in more than 63 countries worldwide. Uber Eats has grown in numbers significantly throughout 2020. Similarly to GrubHub, it provides an easy solution for consumers to buy food from local restaurants and have it delivered right away. Uber Eats holds more than a 25% market share in the food delivery industry. Uber, despite its ride sharing being way down, has been able to perform well due to its food delivery sector. So now let’s look at the recent news and advancements for the company.
As stated before, its delivery segment is growing despite its other services falling. Well, Uber released its second quarter results back on August 6th, and things did not look good. Its revenue fell 29% to $2.2 billion, and its gross bookings welt down 35%. But its gross bookings grew 122% for its food delivery segment.
Dara Khosrowshahi, the CEO of Uber stated, “Our team continues to move at Uber speed to respond to the pandemic’s impact on our communities and on our business, leading our industry forward with new products and safety technologies, and harnessing the strong tailwinds driving exceptional growth in Delivery, with Gross Bookings growing 122 percent year-over-year excluding exited markets.”
UBER stock has been able to recover in 2020. Back in January, it was at $30 a share on average, and as of October 9th, it is at $37.27 a share. This increase for UBER stock price is essentially why it has made its way on to this list of food delivery stocks to watch.
Top Food Delivery Stocks To Watch In Q4 2020: Papa John’s International Inc.
Last on this list of food delivery stocks comes Papa John’s International Inc. (PZZA Stock Report). Papa John’s is currently the fourth largest pizza delivery company in the United States. It operates a chain of pizza delivery restaurants in many locations around the nation. The company has experienced a good amount of growth fueled by the pandemic. So let’s look at what has been going on recently with Papa John’s.
On August 6th, the company released its second-quarter financial results for 2020. The most noteworthy of the reports was the sales increase of 5.3%, and 13.3% internationally.
The CEO of the company stated, “Across the U.S. and those international markets where delivery-based businesses have remained open, we have safely and successfully met the needs of millions of new and returning customers who have relied on us for high-quality, delicious pizza, Papadias, and other food during the pandemic. ”
It seems like Papa John’s has figured out the recipe for success when it comes to succeeding with food delivery during the pandemic. PZZA stock price is at $79 a share as of October 9th, up from the $62 a share it started the year at. That is why PZZA stock is the final company on this list of food delivery stocks to watch.