UBS has downgraded HelloFresh to Neutral from Buy and lowered its price target to €4.70 from €6.10, citing increased uncertainty around the company’s growth path following its latest quarterly report.
The change of stance came after HelloFresh reported first-quarter results that marginally outperformed consensus forecasts. The group delivered revenue that was 1% above company consensus and adjusted EBITDA that beat by €3 million.
Operationally, HelloFresh recorded sequential easing in declines across its product lines. Meal-kit revenue declines moderated from -10.2% in the fourth quarter of 2025 to -8.5% in the first quarter, while ready-to-eat meals improved from -7.5% to -6.9% over the same period.
Despite those positive signs, management’s guidance for the second quarter dimmed the outlook. The company signalled it expects a “similar rate” of revenue decline in Q2 as seen in Q1, with meal-kits expected to be “around the same level,” implying no clear sequential improvement for the category.
Management attributed the absence of further sequential recovery to three principal factors: closures in Italy and Spain, the cumulative effects of reduced marketing expenditure, and the macroeconomic environment. The company also stated that it has not yet observed a meaningful impact from macro conditions on its performance.
In response to the guidance and commentary, UBS trimmed its revenue forecasts for fiscal 2026 and 2027 by roughly 1% and 2%, respectively, driven mainly by downward revisions to meal-kit revenues. The broker now projects constant-currency revenue growth of -5.9% for fiscal 2026, a figure that sits within but toward the weaker end of the company’s guidance range of -3% to -6%.
On profitability, UBS reduced its adjusted EBITDA estimates for fiscal 2026 and 2027 by 6%. The firm now anticipates adjusted EBITDA of €373.5 million in fiscal 2026, below the company consensus of €391 million and slightly beneath the company’s guidance range of €375 million to €425 million.
The UBS analyst highlighted that management provided limited detail on why meal-kit performance would not improve sequentially in the second quarter, which lowered conviction about HelloFresh’s short- to medium-term stability. The analyst also questioned whether the company’s substantial incremental investment programme is necessary merely to maintain current performance levels rather than to drive measurable improvement.
Sector and market context
- Company: HelloFresh, a meal-kit and ready-to-eat meals provider.
- Analyst action: UBS downgraded to Neutral and reduced the price target to €4.70.
- Forecast changes: Revenue and adjusted EBITDA estimates for fiscal 2026 and 2027 were cut, reflecting slower meal-kit recovery and management guidance.