On Monday, BTIG increased its price target on shares of Domino's Pizza (NYSE:DPZ) to $580 from the previous $515, while reaffirming its Buy rating on the stock. The adjustment follows Domino's announcement of impressive same-store sales figures, which have been the strongest since the onset of the pandemic.
The company's recent performance has been attributed to several initiatives that have resonated with customers, including the introduction of a new rewards program, a partnership with Uber (NYSE:UBER) Eats, and the promotional Emergency Pizza campaign. These strategies have helped Domino's to outperform broader industry trends and address concerns over potential pizza market saturation.
Looking ahead, BTIG anticipates that Domino's sales momentum will persist into the next quarter, although the growth rate may slightly decelerate. The firm predicts mid-single digit comparable store sales (comps) as Domino's capitalizes on the excitement surrounding its newly introduced NY Style Pizza.
The analyst from BTIG highlighted the carryout segment of Domino's business, which has been expanding at a high-single digit rate in terms of order counts. This segment is noted to be 20% larger than the delivery channel, and the firm believes that the market has yet to fully recognize the potential of Domino's carryout business.
In light of these developments, BTIG has reiterated its Buy rating and Top Pick designation for Domino's Pizza.
InvestingPro Insights
As Domino's Pizza (NYSE:DPZ) continues to captivate the market with its strategic initiatives and robust sales performance, a glance at the real-time data from InvestingPro provides additional context for investors.
The company boasts a market capitalization of $18.32 billion, reflecting its significant presence in the industry. With a P/E ratio of 35.6, Domino's is trading at a high earnings multiple, which may suggest investor confidence in the company's future profitability, despite a slight revenue dip of -1.27% over the last twelve months as of Q1 2023.
InvestingPro Tips highlight Domino's strong track record of dividend growth, having raised its dividend for 10 consecutive years and maintained payments for 13 consecutive years. This consistency could be a positive signal for income-focused investors. Furthermore, the company has demonstrated a high return over the last year, with a price total return of 59.33% as of the date provided, showcasing its potential for capital appreciation.
For those considering adding Domino's Pizza to their portfolio, there are additional InvestingPro Tips available that delve deeper into the company's financial health and market performance. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription to access these insights and make more informed investment decisions.
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