DHER is up 67% YTD, driven primarily by a bidding war between Uber (20% stake + 5% options) and DoorDash, not by fundamentals or earnings.

Short interest has surged, pushing the crowded/squeeze score to 85 —regardless of momentum, with rising borrow costs and convertible hedging.

Key risks: deal falling through, regulatory hurdles, and weak standalone fundamentals (overexpansion, no earnings, high debt); bearish analysts.

Delivery Hero (DHER GR) is a German stock which operates in many countries and has a business model like UberEATS, delivering food, and groceries.

The stock is up 67% year to date and 80% last month.

Most of the stock’s move is deal-driven rather than earnings- or fundamentals-based.

Part of DHER’s rise is that Uber has increased its stake to 20% and made a takeover approach. Uber is the largest shareholder at 20% with another 5% through options. Doordash is also a potential buyer. The deals are not finalized.

DHER has business in EMEA where UberEats and Doordash do not.

The short interest has gone straight up this month causing the crowded score to 85. This means that the squeeze score is based at 85 and it is almost always above 70. Structurally independent of momentum there is always squeeze risk.

The short interest has been rising on the way up and in the past the short interest and stock tracked each other, this is a reversal strategy.

The market is discussing squeeze potential with the bidding war.

In addition to the deal not happening, there is regulatory risk if the deal continues. Without a deal, fundamentals and debt may be harmful with overexpansion and no earnings.

Analysts have been turning bearish because of extended valuations.

The stock is a high-risk stock with realized volatility of 70.

The borrow cost has been increasing on the way up, which makes the squeeze crowded score more extreme.

The convertibles in Delivery Hero cause more shorting activity on the way up. The delta has almost doubled to 7 million shares which would be 1/6 of the short interest, 1/12increase recently, this is a small contribution relative to the short interest increase, so the increase is fundamentally not arb-driven.

Want to know more? Access this data in real time using S3’s BLACK APP & BLACK MAP

The information herein (some of which has been obtained from third party sources without verification) is believed by S3 Partners, LLC (“S3 Partners”) to be reliable and accurate. Neither S3 Partners nor any of its affiliates makes any representation as to the accuracy or completeness of the information herein or accepts liability arising from its use. Prior to making any decisions based on the information herein, you should determine, without reliance upon S3 Partners, the economic risks, and merits, as well as the legal, tax, accounting, and investment consequences, of such decisions.