Lisa Deng, an analyst from Goldman Sachs, maintained the Hold rating on Domino’s Pizza Enterprises Limited (DPZUF – Research Report). The associated price target was lowered to A$36.30.
Lisa Deng has given her Hold rating due to a combination of factors impacting Domino’s Pizza Enterprises Limited’s performance, especially in the European market. The company has struggled to keep pace with its quick-service restaurant peers since the pandemic, which has partially been attributed to a shift back to dine-in preferences, over-expansion, and inadequate investment in digital infrastructure critical for consumer engagement. With sales per store declining, this has inevitably led to less attractive store economics.
Moreover, Deng notes that the payback period for new and split stores is longer than the company’s target, leading to slower than anticipated store growth and, consequently, a stagnation in network sales. Despite this, she does not advise against holding the stock but rather suggests caution, as evidenced by the downward revision of future earnings estimates and the target price. This cautious stance reflects the need for strategic adjustments by Domino’s to reconcile these structural challenges with potential future growth catalysts that could turn the tide for the company’s European operations.
According to TipRanks, Deng is an analyst with an average return of -1.1% and a 47.93% success rate. Deng covers the Consumer Cyclical sector, focusing on stocks such as Domino’s Pizza Enterprises Limited, Wesfarmers Limited, and Flight Centre Travel Group Limited.
In another report released on May 2, UBS also maintained a Hold rating on the stock with a A$40.00 price target.
TipRanks tracks over 100,000 company insiders, identifying the select few who excel in timing their transactions. By upgrading to TipRanks Premium, you will gain access to this exclusive data and discover crucial insights to guide your investment decisions. Begin your TipRanks Premium journey today.
Domino’s Pizza Enterprises Limited (DPZUF) Company Description:
Domino’s Pizza Enterprises Ltd. engages in the management of retail food outlets and franchise services. It operates through the following geographical segments: Australia/New Zealand, Europe, and Japan. The company was founded on December 27, 1983 and is headquartered in Brisbane, Australia.
