 12/16/2020 The New Dynamics of Delivery ✔️ The demand for delivery has grown during the pandemic ... but can it last? ✔️ Are we in a food delivery 'bubble,' and can the major players survive if it bursts? ✔️ And, have you seen these "easy to read" trade alerts from traders who've made a remarkable $284,448.97 in the last 3 months alone…  Delivery isn't just for pizza anymore.
Years ago, when Amazon first hit the scene, people thought it was ridiculous to order a book online. People said, "Why don't you just go to a bookstore?"
But as our lives got busier, it became much easier to press a few buttons and get something delivered rather than deal with the hassle and stress of going to a crowded store.
Then the pandemic hit.
Suddenly, delivery wasn't just a convenient option — but a potentially life-saving option.
Food delivery-related stocks have seen share prices soar.
But will that change post-pandemic?
What stocks could still benefit … and what stocks may have already peaked?
Let's take a look at some of the major players in the food delivery sector right now — including their strengths and weaknesses. Sponsored Ad  If you want to get "easy to read" trade alerts from traders who've made a remarkable $284,448.97 in the last 3 months alone…
Food Delivery
Thanks to a growing number of apps and food delivery companies, ordering food delivery has never been easier. Several of the companies trade publicly too.
For example:
GRUB and UBER surged to new highs during the pandemic.
The DoorDash IPO came at the tail end of the highest demand … but this days-old stock is already going down in price.
GRUB has also taken a hit since the recent vaccine announcements.
Does this mean the sector is getting too crowded?
On the one hand, habits are hard to break. Habits formed in the pandemic are unlikely to disappear — even after a vaccine is widely available. The Amazon Effect
Amazon's business model seemed odd when it first started. Why order things from a website that you could get at a store?
But soon the convenience factor took over. And now lots of people can't imagine getting their essentials anywhere else.
Amazon paved the way for other delivery sectors — including food delivery.
We all want to get back out in the world again. But we've also gotten accustomed to things being delivered right to our door.
It's very convenient to have food delivered … Customers almost always pick convenience over everything else.
But is there really room for so many companies in this sector?
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Crowded Field
Strong competition between delivery-based businesses could cause a race to the bottom.
Right now, DoorDash controls about half of the food delivery market.
But they warned investors that pandemic-level demand isn't likely to stick around. When the pandemic is gone their profits could disappear.
So what's to be done?
Trying to compete by waging price wars probably won't benefit employees or shareholders in the short term.
But it could help thin the field in the long run.
If a company in the food delivery sector can perfect its business model and finds a way to increase its profits, it could potentially dominate the field for a long time to come.
But barring that, I'm not convinced the market will sustain such high prices from so many competitors in the same space. The Uber of…
People love saying that new companies will be 'The Uber of…'
What about the actual Uber, though? This stand-alone company has effectively taken over the world when it comes to last-mile personal transportation.
They've also intelligently diversified their income streams.
For one, they've effectively marketed themselves as a more COVID-friendly mode of transportation than public transit. And when people start traveling again, Uber will be ready to shuttle them from the airport to the hotel and back again.
In the meantime, it's a trusted name that has broken into the food delivery market. With a diversified revenue stream, they're likely to survive.
Right now, they don't need to be the best — or the cheapest. They just need to survive. Beyond that, who knows what the future will hold... Sponsored Ad  Paul Scolardi used to work a regular job…
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Tread Carefully
Things are changing fast.
We had some early winners in the food delivery space — but a lot of the hype has passed.
Food delivery is here to stay. End of the day, convenience is king. But there are still a lot of unknowns.
Right now, inflated stock prices have allowed for big cash infusions that are making it hard to see who might actually lead the pack in the future.
But food delivery stocks are likely in an unsustainable bubble … and there probably won't be a clear winner in the near future.
I could be wrong, but I'm steering clear of an industry with so much uncertainty.
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