Buy Rating Affirmed for Domino’s Pizza Amidst Strong Q1 Performance and Growth Prospects

Analyst Chris O`Cull of Stifel Nicolaus maintained a Buy rating on Domino’s Pizza (DPZ – Research Report), boosting the price target to $565.00.

Chris O`Cull has given his Buy rating due to a combination of factors indicating Domino’s Pizza’s strong performance and potential for continued growth. The first quarter earnings for Domino’s Pizza surpassed expectations, which is notable given the current softer backdrop in the broader quick-service restaurant (QSR) segment. This performance demonstrates the company’s ability to leverage its market leadership and efficiently promote value through its substantial Domino’s Rewards program, which has approximately 33 million members. Additionally, the introduction of new products and the expansion of orders through the Uber Eats channel have contributed positively to sales momentum, providing a robust base for future performance.

The company’s domestic same-store sales (SRS) saw a significant increase, beating both Stifel’s and Street’s projections. The growth in delivery comps and particularly in carryout SRS suggests effective promotional strategies and consumer engagement. Domino’s Rewards program continues to be a substantial driver of sales, with newer redemption levels attracting a broader consumer base. Furthermore, the company’s strategic marketing on the Uber Eats platform and the introduction of new product innovations, like the New York Style pizza, indicate forward-thinking management and a unique value proposition in the market. These initiatives are expected to maintain sales momentum, supporting the Buy rating and the outlook for sustained growth.

According to TipRanks, O`Cull is a 5-star analyst with an average return of 10.7% and a 57.19% success rate. O`Cull covers the Consumer Cyclical sector, focusing on stocks such as Planet Fitness, Dutch Bros Inc, and Chipotle.

In another report released on April 24, Oppenheimer also maintained a Buy rating on the stock with a $530.00 price target.

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Domino’s Pizza (DPZ) Company Description:

Domino’s Pizza, Inc. is a pizza company, which operates a network of company-owned and franchise-owned stores in the U.S. and international markets. It operates though the following three segments: U.S. Stores, International Franchise and Supply Chain. The U.S. Stores segment consists primarily of franchise operations. The International Franchise segment comprises of a network of franchised stores. The Supply Chain segment operates regional dough manufacturing and food supply chain centers. The company was founded by James Monaghan and Thomas Stephen Monaghan in 1960 and is headquartered in Ann Arbor, MI.