Robert W. Baird Issues Pessimistic Forecast for Domino's Pizza (NASDAQ:DPZ) Stock Price

Key Points

• Robert W. Baird lowered Domino’s Pizza’s price target from $325 to $320 while maintaining a “neutral” rating, implying about 8% potential upside from the current price.
• Domino’s exceeded quarterly expectations with EPS of $4.60 versus $4.33 expected and revenue of $1.19 billion, up 3.4% year over year; operating income also rose 8.3% as the company added 175 net stores globally.
• Despite the earnings beat, same-store sales growth was weak at 0.3% in the U.S. and 0.2% internationally, while competition and cautious consumer spending have led management to forecast muted annual comparable-sales growth.

Domino's Pizza (NASDAQ:DPZ - Get Free Report) had its price target lowered by equities researchers at Robert W. Baird from $325.00 to $320.00 in a research note issued to investors on Wednesday, Benzinga reports. The brokerage currently has a "neutral" rating on the restaurant operator's stock. Robert W. Baird's price target points to a potential upside of 8.07% from the stock's current price.

Several other analysts have also commented on the company. Wells Fargo & Company reaffirmed a "reduce" rating and issued a $320.00 price target on shares of Domino's Pizza in a research note on Wednesday. Loop Capital reiterated a "hold" rating and issued a $353.00 price target on shares of Domino's Pizza in a research report on Monday, August 10th. Seaport Research Partners initiated coverage on Domino's Pizza in a research note on Wednesday, September 16th. They set a "neutral" rating for the company. Berenberg Bank raised Domino's Pizza to a "strong-buy" rating in a report on Monday, October 5th. Finally, TD Cowen restated a "hold" rating and issued a $320.00 target price on shares of Domino's Pizza in a research note on Tuesday. One equities research analyst has rated the stock with a Strong Buy rating, sixteen have given a Buy rating, thirteen have assigned a Hold rating and two have assigned a Sell rating to the company. According to MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and a consensus target price of $386.16.

Domino's Pizza Price Performance

Shares of Domino's Pizza stock opened at $296.10 on Wednesday. The firm has a market capitalization of $9.79 billion, a PE ratio of 16.80, a price-to-earnings-growth ratio of 1.42 and a beta of 0.94. The company's fifty day moving average price is $324.06 and its two-hundred day moving average price is $327.49. Domino's Pizza has a 52-week low of $282.00 and a 52-week high of $442.35.

Domino's Pizza (NASDAQ:DPZ - Get Free Report) last announced its quarterly earnings data on Tuesday, October 13th. The restaurant operator reported $4.60 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $4.33 by $0.27. The company had revenue of $1.19 billion during the quarter. Domino's Pizza had a net margin of 11.86% and a negative return on equity of 15.15%. The company's quarterly revenue was up 3.4% compared to the same quarter last year. During the same quarter in the prior year, the company posted $4.08 EPS. Analysts predict that Domino's Pizza will post 18.96 earnings per share for the current fiscal year.

Insider Buying and Selling

In related news, EVP Kelly Garcia sold 12,430 shares of the firm's stock in a transaction on Wednesday, July 22nd. The stock was sold at an average price of $322.04, for a total transaction of $4,002,957.20. Following the completion of the sale, the executive vice president directly owned 9,352 shares of the company's stock, valued at $3,011,718.08. This trade represents a 57.07% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, CEO Russell Weiner sold 10,850 shares of Domino's Pizza stock in a transaction on Friday, July 17th. The shares were sold at an average price of $330.83, for a total value of $3,589,505.50. Following the completion of the transaction, the chief executive officer owned 43,829 shares of the company's stock, valued at approximately $14,499,948.07. The trade was a 19.84% decrease in their position. The SEC filing for this sale provides additional information. 0.89% of the stock is owned by corporate insiders.

Institutional Trading of Domino's Pizza

A number of hedge funds and other institutional investors have recently made changes to their positions in DPZ. SHP Wealth Management bought a new stake in Domino's Pizza during the 4th quarter worth about $25,000. Rakuten Securities Inc. acquired a new stake in Domino's Pizza in the 2nd quarter valued at about $28,000. Investors Research Corp increased its position in Domino's Pizza by 9,900.0% in the 2nd quarter. Investors Research Corp now owns 100 shares of the restaurant operator's stock valued at $30,000 after acquiring an additional 99 shares in the last quarter. MBM Wealth Consultants LLC bought a new position in shares of Domino's Pizza in the first quarter worth about $31,000. Finally, Cornerstone Planning Group LLC raised its stake in shares of Domino's Pizza by 450.0% in the first quarter. Cornerstone Planning Group LLC now owns 99 shares of the restaurant operator's stock worth $33,000 after acquiring an additional 81 shares during the last quarter. 94.63% of the stock is currently owned by institutional investors and hedge funds.

Domino's Pizza News Roundup

Here are the key news stories impacting Domino's Pizza this week:

• Positive Sentiment: Domino’s reported third-quarter earnings of $4.60 per share, above estimates of roughly $4.33-$4.38 and up from $4.08 a year earlier. Revenue increased 3.4% to $1.19 billion, also exceeding expectations. Domino's Q3 EPS report
• Positive Sentiment: Operating income rose 8.3%, supported by supply-chain sales, franchise royalties and ongoing store expansion. Domino’s added 175 net stores globally, including 149 internationally, providing longer-term growth potential. Domino's third-quarter financial results
• Positive Sentiment: Management said customers are ordering more frequently, which partly offsets lower spending per order. The company also continues to return capital, including a quarterly dividend of $1.99 per share, or $7.96 annualized.
• Neutral Sentiment: TD Cowen reaffirmed its “hold” rating with a $320 price target, implying potential upside from recent levels but signaling limited conviction in a near-term re-rating.
• Negative Sentiment: U.S. same-store sales grew only 0.3%, while international same-store sales increased 0.2%. The weak comparable-sales performance suggests that the earnings beat was driven more by operational improvements than by strong underlying demand. Domino's third-quarter sales report
• Negative Sentiment: Domino’s forecast muted annual same-store sales growth as competition intensifies and cost-conscious consumers reduce spending. Reports also pointed to narrower store margins and a broader slowdown in pizza demand, raising concerns about the company’s growth outlook. Reuters report on Domino's outlook

Domino's Pizza Company Profile

Domino's Pizza, Inc is a global quick-service restaurant company specializing in pizza delivery and carryout. Its menu includes a variety of pizzas, sides, desserts and beverages, with orders placed through digital platforms, phone ordering and participating stores.

Founded in 1960 in Ypsilanti, Michigan, Domino's began as a small pizza business and adopted its current name in 1965. The company has expanded through a primarily franchise-based model, supported by company-owned stores and an integrated supply chain that provides food and other products to many participating locations.

Domino's serves customers in the United States and international markets across North America, Europe, Asia-Pacific, the Middle East, Africa and other regions.

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