HFG: Rising Price Target Will Highlight Improved Revenue Visibility Despite U.S. Competition

The Analyst Price Target for HelloFresh has risen from EUR 9.00 to EUR 10.80, as analysts highlight improving revenue growth prospects and a more attractive valuation, despite lingering competitive concerns in the U.S. market.

Analyst Commentary

Bullish analysts point to a more favorable risk and reward profile for HelloFresh at current share levels, citing improving visibility on revenue growth and a valuation that now better reflects recent operational challenges.

At the same time, more cautious voices emphasize that the competitive landscape, particularly in the U.S. prepared meals segment, remains a key execution risk that could cap upside if not managed effectively.

Bullish Takeaways

• Recent upgrades highlight a compelling risk and reward setup, with the higher price target suggesting upside potential from current levels as execution stabilizes.
• Improving revenue growth prospects, supported by a diversified product mix and international footprint, are seen as underappreciated in the current valuation.
• Analysts view the current share price as discounting much of the recent operational and macro uncertainty, creating room for multiple expansion if growth reaccelerates.
• Cost discipline and scale benefits in core markets are expected to support margin resilience, bolstering confidence in medium term earnings power.

Bearish Takeaways

• Bearish analysts remain concerned about intensifying competition in the U.S., particularly for the Factor brand, which could pressure customer acquisition costs and limit margin expansion.
• Some see the reduced price targets as reflecting a more muted growth trajectory, with the risk that U.S. market share gains will be harder to capture than previously anticipated.
• Lingering uncertainty around consumer demand in key regions raises questions about the sustainability of recent growth improvements and the pace of re rating in the shares.
• Execution missteps in managing product complexity and logistics in a competitive environment could delay the realization of the company’s full earnings potential.

What's in the News

• HelloFresh launches an AI driven recipe card development system that cuts dish design and production timelines from weeks to hours, initially rolling out to US customers in November with printed cards in boxes from early December and a global rollout targeted by the end of first quarter 2026 (Key Developments).
• The new AI powered tool suite is designed to handle production and design tasks so chefs and food stylists can focus on culinary creation. HelloFresh emphasizes that recipe development remains human led to preserve quality and taste (Key Developments).
• From July 1, 2025 to September 30, 2025, HelloFresh repurchased 5.4 million shares for EUR 45 million, completing a total buyback of about 11.1 million shares, or 6.95% of shares outstanding, for EUR 97.5 million under its December 23, 2024 program (Key Developments).
• HelloFresh reconfirmed its full year 2025 guidance and still expects constant currency revenue to decline between 6% and 8% (Key Developments).

Valuation Changes

• The fair value estimate has fallen slightly from €10.82 to €10.17 per share, implying a modest reduction in intrinsic value despite improved growth assumptions.
• The discount rate has risen slightly from 5.59% to 5.95%, reflecting a marginally higher perceived risk profile or required return from investors.
• Revenue growth has improved significantly from an implied contraction of approximately 0.52% to expected growth of about 0.57%, signaling a shift to a modest expansion outlook.
• The net profit margin has risen slightly from 2.93% to 2.98%, indicating only a minor upgrade to medium-term profitability expectations.
• The future P/E multiple has fallen moderately from 8.38x to 7.62x, suggesting a cheaper valuation on updated earnings forecasts despite the improved growth profile.