The Deliveroo share price upward momentum held steady recently as the number of Delta variant cases continued rising in the UK. The ROO shares rose to 320p, which is the highest they have been since July 8. This values the company at more than 5.45 billion pounds.
Deliveroo news. Deliveroo is a leading food delivery company in the UK. It competes with the likes of Uber Eats, Just Eat Takeaway, Grubhub, and Cavier, among others. The firm went public in what has now been dubbed as the worst IPO in London in more than a decade. Since going public, the company’s shares have declined by more than 20%. They are still about 40% above the lowest level on record.
The Deliveroo stock received a bullish catalyst four weeks ago when a court in London ruled that the company’s riders were not employees. This was a major issue that caused many institutional investors to avoid the company. Today, data compiled by Yahoo Finance shows that most of the stock is hold by mutual funds like the Fidelity Contrafund, T.Rowe Price New Horizons Fund, and Fidelity Blue Chip Growth Fund.
Institutional investors like Abrdn and Legal & General have all avoided the shares because of how they are structured. Like many startups, the founder and CEO of the company maintains a substantial stake in the firm. As such, these firms were afraid of having minimal say in the company.
The Deliveroo stock price has staged a recovery after the court ruling. Many investors thought that the shares were extremely cheap when they declined to 225p. Also, there are hopes that the delivery business will keep doing well as the Delta variant spreads.
Deliveroo share price long-term forecast
Fundamentally, Deliveroo has a strong business and market share. This growth will likely continue especially as more people prefer shopping online.
A look at the four-hour chart shows that the shares have been in a strong bullish trend after it moved above the resistance of the ascending triangle pattern. It remains being supported by the 50-day moving average. It is slightly below the important resistance at 337p and is forming a cup and handle pattern.
Therefore, the shares will likely keep rising as bulls target this resistance level. In the long-term, I believe that the shares will ultimately rise above its all-time high of 390p.
Don’t miss a beat! Follow us on Telegram and Twitter.
ROO chart
Follow Crispus on Twitter.