Domino's (DPZ) Reports Solid Q2 Growth Driven by U.S. and International Sales | DPZ Stock News

Author's Avatar
4 days ago
Article's Main Image

Domino's Pizza (DPZ, Financial) posted strong financial performance in the second quarter, with revenue figures reaching $1.15 billion, surpassing the market consensus of $1.14 billion. The company reported a 3.4% rise in U.S. same-store sales, while international same-store sales improved by 2.4%, excluding currency fluctuations. Despite facing global economic challenges, Domino's continues to expand its market presence.

In the U.S., both delivery and carryout services contributed to significant market share gains in the quick-service pizza sector. The complete integration with two major food delivery platforms and the offering of various crust types, including stuffed crust, have strengthened the company's market positioning. Domino's boasts not only superior unit economics and the largest advertising budget in the industry but also a comprehensive rewards program and a strong supply chain. These assets position the business for continued growth and value creation for franchisees and shareholders alike.

Wall Street Analysts Forecast

1947245114195865600.png

Based on the one-year price targets offered by 31 analysts, the average target price for Domino's Pizza Inc (DPZ, Financial) is $483.07 with a high estimate of $559.00 and a low estimate of $370.00. The average target implies an upside of 3.67% from the current price of $465.95. More detailed estimate data can be found on the Domino's Pizza Inc (DPZ) Forecast page.

Based on the consensus recommendation from 35 brokerage firms, Domino's Pizza Inc's (DPZ, Financial) average brokerage recommendation is currently 2.1, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.

Based on GuruFocus estimates, the estimated GF Value for Domino's Pizza Inc (DPZ, Financial) in one year is $480.53, suggesting a upside of 3.13% from the current price of $465.95. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Domino's Pizza Inc (DPZ) Summary page.

DPZ Key Business Developments

Release Date: April 28, 2025

  • Income from Operations: Increased 1.4% in Q1, excluding foreign currency impact.
  • Global Retail Sales Growth: 4.7% increase, excluding foreign currency impact.
  • US Retail Sales Growth: 1.3% increase, driven by net store growth.
  • Same-Store Sales: Declined 0.5% in the US.
  • Carry-Out Business Comps: Up 1%.
  • Delivery Business Comps: Down 1.5%.
  • US Store Count: Added 17 net new stores, totaling 7,031.
  • International Retail Sales Growth: 8.2% increase, excluding foreign currency impact.
  • International Same-Store Sales: Increased 3.7%.
  • Net Store Changes: Decrease of 25 stores internationally, primarily due to closures in Japan.
  • Share Repurchase: Approximately 115,000 shares repurchased at an average price of $434, totaling $50 million.
  • Share Repurchase Authorization Remaining: $764 million.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Domino's Pizza Inc (DPZ, Financial) achieved market share gains in both US and international markets despite consumer and industry headwinds.
  • The launch of the Parmesan Stuffed Crust Pizza has been well-received, with high customer satisfaction scores and a strong mix of orders.
  • The partnership with DoorDash is expected to significantly enhance delivery capabilities and is anticipated to be approximately 50% incremental.
  • Domino's Pizza Inc (DPZ) continues to drive renowned value through national promotions and rewards programs, which have been effective in a challenging economic environment.
  • The company has made strategic organizational changes to improve efficiency and align with its Hungry for MORE strategy, which is expected to drive long-term growth.

Negative Points

  • Same-store sales in the US declined by 0.5%, slightly below expectations, due to negative traffic and a decline in delivery business.
  • The delivery business continues to be impacted by macroeconomic pressures affecting low-income consumers.
  • Net store growth in the US was modest, with only 17 net new stores added in the first quarter.
  • International net store count decreased by 25 due to closures by Domino's Pizza Enterprises, primarily in Japan.
  • The company faces potential geopolitical pressures that could impact international sales and growth.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.