Irenic Capital Management LP Makes New $51.70 Million Investment in Papa John's International, Inc. $PZZA

Key Points

• Irenic Capital Management LP purchased 1,073,700 shares of Papa John's (NASDAQ: PZZA) in Q3 worth about $51.7 million, making the stock its second-largest holding (~5.4% of the fund) and representing a 3.27% stake in the company.
• Analysts’ consensus is a Hold with an average target of $45, and several firms (Benchmark, Stephens, Mizuho) have recently trimmed price targets, signaling tempered expectations.
• Papa John’s latest quarter had a slight EPS beat ($0.34 vs. $0.33) but revenue fell 6.1% year-over-year and margins are thin; the stock yields 5.0% but carries a very high payout ratio (~206.7%), which may raise sustainability concerns.

Irenic Capital Management LP purchased a new stake in shares of Papa John's International, Inc. (NASDAQ:PZZA - Free Report) during the 3rd quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The fund purchased 1,073,700 shares of the company's stock, valued at approximately $51,699,000. Papa John's International makes up approximately 5.4% of Irenic Capital Management LP's portfolio, making the stock its 2nd largest position. Irenic Capital Management LP owned 3.27% of Papa John's International as of its most recent SEC filing.

A number of other hedge funds have also modified their holdings of the stock. Brandes Investment Partners LP boosted its position in Papa John's International by 271.6% during the second quarter. Brandes Investment Partners LP now owns 690,299 shares of the company's stock valued at $33,783,000 after purchasing an additional 504,514 shares during the last quarter. Gradient Investments LLC acquired a new position in Papa John's International in the 3rd quarter worth about $13,036,000. Cantor Fitzgerald L. P. purchased a new stake in shares of Papa John's International during the 3rd quarter worth about $12,374,000. Segall Bryant & Hamill LLC raised its stake in shares of Papa John's International by 27.3% during the 3rd quarter. Segall Bryant & Hamill LLC now owns 1,174,369 shares of the company's stock worth $56,546,000 after purchasing an additional 251,560 shares in the last quarter. Finally, Arvin Capital Management LP acquired a new stake in shares of Papa John's International during the 2nd quarter valued at about $9,979,000.

Analysts Set New Price Targets

Several equities analysts recently weighed in on PZZA shares. Zacks Research raised shares of Papa John's International from a "strong sell" rating to a "hold" rating in a research report on Monday, January 26th. Weiss Ratings restated a "hold (c-)" rating on shares of Papa John's International in a research note on Monday, December 29th. Benchmark cut their price target on shares of Papa John's International from $60.00 to $50.00 and set a "buy" rating on the stock in a report on Friday, February 27th. Stephens reduced their price objective on shares of Papa John's International from $49.00 to $40.00 and set an "overweight" rating for the company in a research note on Friday, February 27th. Finally, Mizuho decreased their price objective on shares of Papa John's International from $40.00 to $34.00 and set a "neutral" rating for the company in a report on Friday, February 20th. Three investment analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the company. According to MarketBeat, Papa John's International has an average rating of "Hold" and an average target price of $45.00.

Papa John's International Stock Up 1.9%

Shares of NASDAQ:PZZA opened at $36.79 on Monday. The company has a market cap of $1.21 billion, a price-to-earnings ratio of 41.34, a PEG ratio of 1.74 and a beta of 1.23. The business has a 50 day moving average price of $34.82 and a 200 day moving average price of $41.40. Papa John's International, Inc. has a twelve month low of $29.55 and a twelve month high of $55.74.

Papa John's International (NASDAQ:PZZA - Get Free Report) last issued its quarterly earnings results on Thursday, February 26th. The company reported $0.34 EPS for the quarter, topping the consensus estimate of $0.33 by $0.01. Papa John's International had a negative return on equity of 11.16% and a net margin of 1.44%.The company had revenue of $498.18 million for the quarter, compared to the consensus estimate of $517.25 million. During the same period in the previous year, the business posted $0.63 EPS. The company's revenue for the quarter was down 6.1% on a year-over-year basis. Analysts anticipate that Papa John's International, Inc. will post 2.19 EPS for the current year.

Papa John's International Announces Dividend

The business also recently disclosed a quarterly dividend, which was paid on Friday, February 20th. Stockholders of record on Monday, February 9th were given a dividend of $0.46 per share. The ex-dividend date of this dividend was Monday, February 9th. This represents a $1.84 dividend on an annualized basis and a dividend yield of 5.0%. Papa John's International's dividend payout ratio is currently 206.74%.

Papa John's International Profile

Papa John's International, Inc is a leading American pizza restaurant chain known for its focus on high-quality ingredients and consistent product offerings. Founded in 1984 by John Schnatter in Jeffersonville, Indiana, the company has grown to operate thousands of restaurants across the United States and in more than 40 international markets. Papa John's restaurants are primarily franchised, supported by a network of corporate-owned outlets that together drive brand standards, operational guidance and marketing efforts.

The core menu at Papa John's centers on a variety of hand-tossed and pan pizzas made with a signature stone-baked crust and topped with real cheese, vine-ripened tomato sauce and premium meats and vegetables.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.