Activist turns up the heat on Just Eat after orders stall
STALLING UK orders growth at Just Eat left a bad taste in shareholders’ mouths as activist investor Cat Rock ramped up the pressure on the takeaway app giant’s management.
Cat Rock said a 7.4pc rise in orders during the first quarter was “unacceptable” and emphasised the “need for urgent change”, calling on Just Eat to explore a merger with a rival.
The company blamed early spring sunshine for the slowdown, vowing to improve growth during the rest of the year. Rivals Uber Eats and Deliveroo are stepping up their attempts to grab market share from Just Eat and analysts at Barclays warned that increased competition appears to have also had an impact on its figures. The disappointing update put shares in reverse gear as Just Eat slid 34.2p to 714.4p, a 4.6pc tumble.
Elsewhere, US GDP growth smashing economists’ expectations failed to boost Wall Street to fresh record highs as economists warned that temporary factors underpinned the figures.
The US economy defied the slowdown taking hold in Europe and China as gross domestic product rose at a 3.2pc annualised rate during the first quarter. Markets in New York opened flat while the FTSE 100 was weighed down by heavy fallers and the oil price surge cooling. Brent crude slumped more than 4pc after Donald Trump claimed he “called up Opec” to tell the oil cartel to bring prices down. The index edged 5.94 points lower to 7,428.19, a third straight day of decline.
Glencore extended its losing streak to a fifth day after US regulators opened an investigation looking into whether the global miner has been involved in “corrupt practices”.
The miner believes the inquiry has a “similar scope in terms of subject matter as the current ongoing investigation by the US Department of Justice” looking at its operations in Nigeria, Venezuela and the Democratic Republic of Congo. More scrutiny from regulators in the US “will not help the recently recovering sentiment from investors around Glencore shares”, said RBC Capital Markets analyst Tyler Broda. Glencore slipped 10.6p to 310.9p as investors reacted to the announcement after the end of play on Thursday.
Broker AJ Bell continued its surging start on London’s stock market, hitting fresh record highs after revealing its interim results will be “slightly ahead” of expectations. The investment platform’s assets under administration climbed 8pc to £48bn as customer numbers hit a record high, rising 5pc. Since its December float, its shares have surged more than 150pc, up a further 30p to 407p yesterday.
Stagecoach extended a two-day surge after Citigroup added the bus and train operator to its “buy” list, arguing that the “risks are now much lower”. Citi’s upgrade boosted Stagecoach 11.7p to 133.4p. Insurer
Hastings tumbled to a near four-month low after warning its loss ratio – the amount spent on claims compared to earnings from premiums – would rise towards the upper end of its target range. Its shares slid 28p to 191p.