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BUZZ Delivery Hero returns to form – HSBC ups to buy – Reuters

** HSBC upgrades Delivery Hero (DHER.DE) to “buy” from “hold” and raises PT by 23% to EUR 160, as it views the German food delivery company’s Q3 results a step in the right direction to merge revenue growth with progress on profitability after Q2 negatives

** The company’s latest quarterly results were “a vast improvement” from a “very odd” Q2, according to the broker

** In particular, the broker sees progression on own-delivery contribution profit, an easier competitive picture and more visibility on the path to progress and eventually breakeven

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** Despite some “loose ends” remaining, such as the logic behind its long-term Germany strategy, the broker sees Delivery Hero as “relatively well placed”

** Despite seeing losses to continue, HSBC highlights the company’s liquidity and its strength vs peers in emerging markets such as South Korea and the MENA region, where competition should be easier

** The stock is up 2.6%, making it the third-strongest performer on German blue-chip index (.GDAXI)

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Reporting by Alexander Kloss in Gdansk

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