Deliveroo, one of the fastest-growing food delivery companies in the UK, is set to IPO on the London Stock Exchange on April 4.
In this guide, we’ll show you how to buy Deliveroo shares in the UK and cover everything you need to know about the Deliveroo IPO.
67% of retail CFD accounts lose money when trading CFDs with this provider.
- 1 Step 1: Find the Best Stock App to Buy Deliveroo Shares UK
- 2 Step 2: Analyse Deliveroo Shares
- 3 Deliveroo Share Price UK
- 4 Deliveroo Stock Fundamentals
- 5 Deliveroo Dividend Information
- 6 Should I Buy Deliveroo Shares UK?
- 7 Step 3: Open a Stock Trading App Account
- 8 Step 4: How to Buy Deliveroo Shares UK: Tutorial
- 9 Deliveroo Shares Buy or Sell?
- 10 Our Verdict on Deliveroo Shares UK
- 11 eToro – Buy Deliveroo Shares UK with 0% Commission
- 12 FAQs
Deliveroo shares haven’t quite hit the market yet, but many brokers are planning to offer Deliveroo trading as soon as the shares land on the London Stock Exchange. So, what’s the best UK stock app to buy Deliveroo shares? Let’s take a closer look at our top 2 picks:
1. eToro – Best UK Stock App to Buy Deliveroo Shares
The eToro app is the overall best stock app in the UK for anyone who wants to get in on the Deliveroo IPO. This brokerage app offers trading on nearly 2,000 shares from around the world, including hundreds on the London Stock Exchange. On top of that, eToro is typically one of the first brokers to offer trading on hot new shares as soon as they hit the market.
One of the best things about eToro is that trading is 100% commission-free. The platform charges low spreads, as well as inactivity and withdrawal fees that are easily avoided. eToro also gives you the option to buy fractional shares with as little as £35, which can come in handy if you only want to spend a small amount on Deliveroo stock.
eToro’s mobile app is well-built for both short term trading and long term investing. For anyone who wants to day trade around the Deliveroo IPO, the app offers a comprehensive charting experience with over 100 technical indicators and drawing tools built in. You can easily customise these indicators with a few taps. You can also use eToro as a paper trading app to practise a new strategy.
The app also offers access to professional analyst research, including 12-month price targets for popular stocks. eToro offers watchlists, price alerts, a market news feed, and more to help you stay on top of market conditions.
The eToro app also features an integrated social trading network, which enables you to swap ideas and trading strategies with thousands of other traders. This can be particularly helpful for trading around the Deliveroo IPO, since you can see how other traders are responding to the new shares and buy or sell accordingly.
eToro is regulated by the UK Financial Conduct Authority (FCA) and is considered highly trustworthy. All UK accounts are insured through the Financial Services Compensation Scheme (FSCS) for up to £85,000. The eToro app is available for both iOS and Android devices, and you can get in-app phone, chat, or email support 24/5.
- Trade hundreds of LSE-listed shares
- Buy fractional shares with just £35
- 100% commission-free trading
- Advanced charting and social networking
- Regulated by the FCA
- Small inactivity and withdrawal fees
67% of retail CFD accounts lose money when trading CFDs with this provider.
2. Capital.com – Best CFD Trading App to Buy Deliveroo Shares UK
The Capital.com app is one of the top CFD trading platforms in the UK for buying and selling Deliveroo shares after the IPO. This app offers trading on thousands of shares, including most of the FTSE 100 and AIM index shares. Capital.com also offers trading on hot US IPO stocks like Coinbase shares, for traders who want to jump from one IPO to the next.
This brokerage app stands out in a few key ways. First, it offers 100% commission-free trading with some of the tightest spreads available in the UK. On top of that, Capital.com doesn’t have any deposit, withdrawal, or inactivity fees that can take away from your trading profits. We also like that Capital.com allows you to use leverage up to 5:1, so you can make big bets with a relatively small amount of funds to start.
Capital.com’s mobile charting software is highly advanced, offering dozens of technical indicators and drawing tools. The tools are incredibly easy to customise just by tapping, which makes it simple to conduct advanced price analysis from your smartphone. In addition, the Capital.com app offers price alerts, a market news feed, and more.
Another reason to like Capital.com is that it offers a suite of educational tools for new traders. The platform has a series of videos that explain the basics of CFD trading and technical analysis, for example. You’ll also find a dedicated trading education app that offers tutorials, quizzes, and other tools to help you master the market.
Capital.com is regulated by the UK FCA and the Cyprus Securities and Exchange Commission (CySEC). Your account includes 24/7 phone, email, and live chat support, all of which is available right from the Capital.com app.
- Trade thousands of UK and US shares
- 100% commission-free trading with low spreads
- Excellent trading education resources
- Highly customisable mobile charting interface
- Regulated by the FCA and CySEC
- Doesn’t offer trading on shares outside the US and Europe
71.2% of retail CFD accounts lose money when trading CFDs with this provider.
Before you invest in the Deliveroo IPO, it’s important to understand how this food delivery company got to this point and what the stock could do once it hits the London Stock Exchange.
Deliveroo was founded as a London-based food delivery company in 2013 by William Shu, who remains the company’s CEO. The company quickly expanded to over 200 locations across the UK, Europe, Australia, Hong Kong, the UAE, and Kuwait.
The company is highly similar to UberEats and Doordash, which also operate in the UK. Deliveroo relies on self-employed drivers to deliver food, and it has a subscription service that offers unlimited food delivery in addition to allowing users to purchase one-time food orders.
Amazon made an investment in Deliveroo in 2019 which gave Amazon a 16% stake in Deliveroo at a roughly £2 billion valuation. The company received another round of funding in January of this year that valued the company at £2 billion. In total, Deliveroo has received roughly £1.7 billion in private funding.
Deliveroo plans to price its shares between £3.90 and £4.60 per share when they debut on the London Stock Exchange on April 4, 2021. That corresponds to a market at the time of the IPO of £7.6 billion to £8.8 billion and the company is aiming to raise around £1 billion in new funding through the listing.
Notably, Deliveroo is offering shares not only to major investors, but also to existing customers. Anyone in the UK who has a Deliveroo account can apply to buy shares, although the company will prioritise its most loyal customers if the £50 million in shares it is setting aside for this purpose is oversubscribed.
Deliveroo Stock Fundamentals
Deliveroo generated revenue of £1.2 billion last year, but declared a loss of £223.7 million. Still, that represents an improvement from 2019, when the company declared a loss of £317.3 million.
The company expects to list on the LSE with a market cap of £7.6 billion to £8.8 billion, although this could change dramatically by the end of the first day of trading. Deliveroo has not calculated its earnings per share (EPS) ahead of the IPO.
Deliveroo Dividend Information
Deliveroo was not profitable in 2020 and does not expect to be profitable this year. The company does not pay a dividend and is unlikely to make payments to investors for at least several years.
With the Deliveroo IPO coming up on April 4, should you buy Deliveroo shares UK as quickly as possible once they hit the market?
We’re pessimistic about Deliveroo’s prospects as a long term investment. However, the stock could be a good prospect to target for trading around the IPO. Here’s why:
Food Delivery is a Tough Business
Over the long term, it’s hard to see how Deliveroo succeeds. The company was unprofitable in the midst of the coronavirus pandemic, which arguably increased demand for food delivery to the highest level it will ever be. If Deliveroo couldn’t turn a profit last year, why should investors expect it to be able to in the years ahead?
Investors need to look no further than Deliveroo’s biggest competitors, Doordash and UberEats, to see just how difficult it is to turn a profit in the food delivery business. Doordash lost £110 million last year, while UberEats was a similarly money-losing venture for Uber.
Worse, these money-losing companies are all undercutting each other to win market share among the same set of customers. Doordash and UberEats have much deeper pockets than Deliveroo to continue losing money for years to come. So it’s much more likely that Deliveroo folds – or investors lose confidence and the share price plummets – before its competitors.
Another reason we have a negative long term outlook on Deliveroo shares is that the company doesn’t control its own fate.
For one thing, the recent UK court ruling that determined that Uber drivers are workers, not self-employed individuals, has enormous implications for Deliveroo. The company has similarly classified its food delivery drivers as self-employed contractors, and it’s almost certainly going to face fines and legal challenges not too long after its IPO.
Deliveroo’s rapid rise is also illustrative of how little moat any food delivery company has in the global marketplace. Deliveroo rose to challenge Doordash and UberEats in just 8 years. There are few barriers preventing another VC-backed competitor from breaking into the food delivery market and forcing Deliveroo to cut its prices even further.
Buying the Deliveroo IPO
Despite the fact that we’re bearish about Deliveroo for long term investing, it’s still worth looking at the food delivery company’s IPO on the LSE as an opportunity to turn a quick profit. On average, IPOs last year saw a first-day pop of 42% and a first-year performance of 75%. Doordash, which held its IPO in the US, saw an 86% gain on the first day of trading.
The key to trading around the IPO is to buy in at as close to the IPO price as possible. If you’re already a Deliveroo user, consider applying to receive some of the shares that the company has set aside for its customers. If you can’t get your hands on these shares, you’ll need the best day trading app to help you get the best market price on the day of the IPO.
So, if you’re willing to buy Deliveroo shares early and then drop them at the first sign of trouble, you could potentially make some money off the IPO.
Step 3: Open a Stock Trading App Account
Want to buy Deliveroo shares in the UK during the IPO? We’ll show you how to invest using the eToro app, which offers 100% commission-free trading on hundreds of LSE-listed shares. This investment app also offers advanced technical trading tools so you can make quick moves around the IPO price.
To begin, download the eToro app from the Apple App Store or from Google Play. Once the app is installed, open it and click ‘Join Now’ to create a new account. If you already have a Google (Alphabet) or Facebook profile, you can use those details to open your eToro account.
eToro requires that you verify your identity before depositing funds and trading in order to meet the FCA’s Know Your Customer (KYC) rules. Take a photo of your driver’s license or of the photo page of your passport with your smartphone and upload it using the eToro app. You will also need to take a photo of a recent utility bill or bank statement that shows your current address and upload that through the app.
Next, deposit funds into your trading account. You can make a payment by debit card, credit card, PayPal, Neteller, Skrill, or bank account transfer. eToro requires a minimum deposit of £160 for electronic payments or £500 for bank transfers.
Now that your eToro account is funded, you’re ready to buy Deliveroo shares in the UK.
Head to your account dashboard and tap the magnifying glass to search for ‘Deliveroo.’ Tap on it when it appears, and then tap ‘Trade’ to open a new order form.
Enter the amount of money you want to invest in Deliveroo stock. eToro allows you to purchase fractional shares, so you can invest any amount over £35. If you’re trading CFDs, you can apply leverage up to 5:1 to your trade. You can also add a stop loss or take profit level to manage your trading risk.
Once you’re ready, tap ‘Open Trade’ to buy Deliveroo shares in the UK.
Deliveroo is in the highly competitive business of food delivery. Almost no major company operating in this market has managed to turn a profit thus far, and Deliveroo doesn’t have the same deep pockets as competitors like Doordash and UberEats. As much as we’d like to see Deliveroo succeed – it’s a homegrown UK company, after all – we’re bearish about the long term prospects for Deliveroo shares.
That said, there is a potential opportunity for UK investors to make money off of the Deliveroo IPO. The red-hot IPO market has sent shares soaring on the first day of trading over the past year, and it seems likely that Deliveroo will experience the same sort of first-day bump. Savvy traders can buy Deliveroo shares early and sell them at the first sign of bad news to try to earn a quick profit.
Deliveroo’s IPO is one of the most highly anticipated events for the London Stock Exchange in 2021. This food delivery company is planning to debut with a market cap as high as £8 billion and is offering its own customers a chance to get in on the IPO.
We have strong reservations about Deliveroo as a long term investment, but the IPO does present an opportunity for short term traders. If you’ve got the best stock app and quick trigger fingers, it may be possible to earn a fast profit by trading Deliveroo shares during and immediately after the IPO.
Ready to buy Deliveroo shares in the UK? Click the link below to start trading with eToro today!
67% of retail CFD accounts lose money when trading CFDs with this provider.
Who is the current CEO of Deliveroo?
The founder and CEO of Deliveroo is William Shu. The IPO is structured so that Shu’s shares will have 20 times the voting power of ordinary Deliveroo shares.
What countries does Deliveroo operate in?
Deliveroo currently operates in the UK, France, Belgium, Italy, Ireland, the Netherlands, Spain, Singapore, Hong Kong, Australia, the United Arab Emirates, and Kuwait. Deliveroo does not operate in the US or China.
Does Deliveroo need to classify its drivers as employees?
Deliveroo was not immediately affected by the recent UK Supreme Court ruling that Uber drivers must be re-classified as employees. However, it seems likely that Deliveroo will face legal challenges related to this case, as the company currently classifies its drivers as self-employed contractors.
How much market share does Deliveroo have in the UK?
Deliveroo controls 36% of the UK’s restaurant food delivery market, compared to 37% for JustEat and 26% for UberEats.
Could Deliveroo be bought by Doordash or Grubhub?
Deliveroo has not made any announcements about a merger with another food delivery company. However, JustEat and Grubhub recently announced plans to merge, and Deliveroo could be an acquisition target as the delivery market consolidates.
Can I buy Deliveroo shares through an ISA or SIPP?
Yes, you can buy Deliveroo shares through an ISA (Individual Savings Account) or SIPP (Self-invested Personal Pension). Your broker must offer both these account types and trading on Deliveroo shares.