Stock Traders Buy High Volume of Call Options on Domino's Pizza (NASDAQ:DPZ)

Key Points

• Unusual options activity: Traders bought 2,760 Domino’s call options, approximately 81% above the typical daily volume.
• Shares declined and earnings missed expectations: DPZ fell to $296.06, near its 52-week low, after reporting quarterly EPS of $4.07 versus the $4.17 consensus estimate, although revenue increased 4.3% year over year.
• Analyst sentiment remains mixed: The stock carries a consensus “Hold” rating with an average price target of $398.06, while insiders sold more than $7.7 million of shares over the past three months.

Domino's Pizza Inc (NASDAQ:DPZ - Get Free Report) saw some unusual options trading on Friday. Traders acquired 2,760 call options on the company. This is an increase of approximately 81% compared to the typical daily volume of 1,528 call options.

Domino's Pizza Price Performance

NASDAQ DPZ traded down $1.59 during trading on Friday, hitting $296.06. The company's stock had a trading volume of 211,004 shares, compared to its average volume of 914,241. The business's 50 day simple moving average is $336.37 and its 200-day simple moving average is $339.15. The company has a market cap of $9.79 billion, a PE ratio of 16.78, a P/E/G ratio of 1.38 and a beta of 0.94. Domino's Pizza has a fifty-two week low of $282.00 and a fifty-two week high of $442.35.

Domino's Pizza (NASDAQ:DPZ - Get Free Report) last issued its quarterly earnings results on Monday, July 20th. The restaurant operator reported $4.07 EPS for the quarter, missing analysts' consensus estimates of $4.17 by ($0.10). The firm had revenue of $1.19 billion for the quarter. Domino's Pizza had a negative return on equity of 15.15% and a net margin of 11.86%.The business's revenue for the quarter was up 4.3% compared to the same quarter last year. During the same period in the prior year, the company posted $3.81 earnings per share. Analysts expect that Domino's Pizza will post 18.94 EPS for the current fiscal year.

Domino's Pizza Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, September 30th. Shareholders of record on Tuesday, September 15th will be paid a $1.99 dividend. This represents a $7.96 dividend on an annualized basis and a yield of 2.7%. The ex-dividend date of this dividend is Tuesday, September 15th. Domino's Pizza's dividend payout ratio (DPR) is 45.15%.

Insider Activity

In related news, EVP Kelly E. Garcia sold 12,430 shares of the business's stock in a transaction that occurred on Wednesday, July 22nd. The shares were 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 in the company, valued at approximately $3,011,718.08. The trade was a 57.07% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, CEO Russell J. Weiner sold 10,850 shares of the stock in a transaction that occurred on Friday, July 17th. The stock was sold at an average price of $330.83, for a total transaction of $3,589,505.50. Following the completion of the sale, the chief executive officer directly owned 43,829 shares of the company's stock, valued at $14,499,948.07. This represents a 19.84% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 23,767 shares of company stock worth $7,737,107 over the last three months. Insiders own 0.89% of the company's stock.

Institutional Investors Weigh In On Domino's Pizza

A number of large investors have recently made changes to their positions in DPZ. Andina Capital Management LLC grew its holdings in shares of Domino's Pizza by 3.1% in the fourth quarter. Andina Capital Management LLC now owns 1,097 shares of the restaurant operator's stock worth $457,000 after purchasing an additional 33 shares during the last quarter. Annis Gardner Whiting Capital Advisors LLC boosted its position in Domino's Pizza by 97.1% during the 4th quarter. Annis Gardner Whiting Capital Advisors LLC now owns 69 shares of the restaurant operator's stock valued at $29,000 after buying an additional 34 shares during the period. Unified Investment Management increased its position in shares of Domino's Pizza by 5.5% in the fourth quarter. Unified Investment Management now owns 745 shares of the restaurant operator's stock valued at $311,000 after acquiring an additional 39 shares during the period. EverSource Wealth Advisors LLC raised its stake in shares of Domino's Pizza by 30.4% during the fourth quarter. EverSource Wealth Advisors LLC now owns 193 shares of the restaurant operator's stock valued at $81,000 after acquiring an additional 45 shares during the last quarter. Finally, Allworth Financial LP raised its stake in shares of Domino's Pizza by 23.0% during the fourth quarter. Allworth Financial LP now owns 267 shares of the restaurant operator's stock valued at $111,000 after acquiring an additional 50 shares during the last quarter. 94.63% of the stock is currently owned by hedge funds and other institutional investors.

Analysts Set New Price Targets

Several research firms have weighed in on DPZ. BTIG Research restated a "buy" rating and issued a $425.00 price target on shares of Domino's Pizza in a research note on Tuesday, July 21st. KeyCorp reiterated a "sector weight" rating on shares of Domino's Pizza in a report on Tuesday, July 21st. Citigroup cut their price objective on Domino's Pizza from $365.00 to $335.00 and set a "neutral" rating for the company in a research report on Tuesday, July 7th. Oppenheimer decreased their target price on Domino's Pizza from $465.00 to $415.00 and set an "outperform" rating on the stock in a research report on Tuesday, July 21st. Finally, UBS Group lifted their price objective on Domino's Pizza from $375.00 to $385.00 and gave the stock a "buy" rating in a research note on Wednesday, September 2nd. Sixteen equities research analysts have rated the stock with a Buy rating, fourteen have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, Domino's Pizza currently has an average rating of "Hold" and a consensus target price of $398.06.

Domino's Pizza Company Profile

Domino's Pizza, Inc is a global restaurant company that operates and franchises stores under the Domino's brand. Its core business centers on the preparation and delivery of made-to-order pizzas, with carryout and digital ordering also playing important roles in its customer service model.

The company's menu includes a variety of pizzas, crusts and toppings, along with side dishes, chicken, sandwiches, desserts and beverages. Domino's also operates a supply chain business that produces and distributes food, equipment and other products to company-owned and franchised stores, supporting consistency across its restaurant network.

Founded in 1960 in Ypsilanti, Michigan, Domino's was initially known as Dominick's before adopting its current name in 1965.

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