Domino’s shares lift despite continued uncertainty on store growth
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The news: Shares in Domino’s Pizza Enterprises (DMP) gained around midday even though US counterpart Domino’s Pizza Inc (DPZ) provided limited insight on DMP growth plans alongside its 3Q earnings report released overnight.
The numbers: At 12:09pm AEDT, DMP shares lifted 2.7% to $15.08 but were still down 48.7% in the year to date.
The context: Overnight, Nasdaq-listed DPZ released its 3Q earnings report overnight, beating expectations.
However, Citi analysts noted that “this appears to be largely driven by the US business, and we have seen little to make us incrementally more positive on sell-rated DMP”.
The analysts flagged that DPZ indicated that DMP’s store closure program is near completion, with the companies working to boost sales in France and Japan suggesting that DMP’s topline issues persist.
UBS analyst Shaun Cousins also noted that “DMP store opening uncertainty remains due to questions on DMP new store paybacks”.
The sources: Citi research, UBS research
