Dominos DPZ Stock Trading News Performance - Q2 23 Reports

Dominos Pizza Inc. Global and U.S. Market Performance:

Domino's reported a global retail sales growth of 5.8% in Q2 2023, accounting for the negative impact of foreign currency. Without this adjustment, global retail sales grew by 4.3%. In the U.S. market, same-store sales experienced a marginal growth of 0.1%. International same-store sales, excluding the impact of foreign currency, posted a healthy growth rate of 3.6%.

Store Expansion and Closures:

In Q2 2023, Domino's expanded its global footprint, adding 197 new stores, which included 27 in the U.S. and 170 international locations. During this quarter, the company opened 253 stores and closed 56.

Profitability and DPZ Stock Dividends:

Domino's diluted earnings per share (EPS) for the quarter stood at $3.08, up 9.2% from the previous year. Reflecting this profitability, the Board of Directors declared a quarterly dividend of $1.21 per share for shareholders on record as of September 15, 2023, payable on September 29, 2023.

Financial Highlights for Dominos Pizza Q2 2023:

The company's net income was $109.38 million, an increase from $102.49 million in Q2 2022. Revenues, however, dropped by $40.6 million or 3.8%, due mainly to lower supply chain revenues and a decrease in the company's market basket pricing to stores. Income from operations rose by $17.3 million or 9.7%, thanks to higher global franchise revenues and robust retail sales growth.

Stocks NYSE:DPZ Repurchases:

During Q2 2023, Domino's repurchased and retired 292,030 shares of common stock for $90.8 million. The total authorized amount for share repurchases as of June 18, 2023, was $289.5 million.

Liquidity Status:

As of June 18, 2023, Domino's liquidity was solid, with unrestricted cash and cash equivalents of $77.0 million, total debt of $5.0 billion, and available borrowing capacity of $277.8 million under its 2021 and 2022 variable funding notes.

Strategic Initiatives and Future Outlook:

Domino's is planning an Investor Day on December 7, 2023, at its headquarters in Ann Arbor, Michigan. The CEO, Russell Weiner, highlighted plans to rejuvenate delivery growth in the U.S. and improve service and staffing. He also expressed optimism regarding the company's partnership with Uber Eats.

DPZ Market Performance:

The company's stock (DPZ) closed at $395.02, a substantial increase from the previous close at $385.44.

Future Earnings Estimates:

The average earnings estimate for the current quarter (June 2023) is $3.05, while the estimate for the next quarter (Sep 2023) is slightly higher at $3.13. For the current year (2023), the average estimate is $13.41, with an expectation to increase to $15.17 in the following year (2024).

Strategic Partnerships:

Domino's partnership with Uber (NYSE: UBER) is expected to provide a platform for about two-thirds of Domino's global operations to leverage Uber's advanced technology.

Revenue Analysis:

Domino's reported a 3.8% year-on-year decrease in revenue for Q2, primarily due to falling income from its supply chain operations and lower order volumes. Nevertheless, easing supply chain pressures and lower food costs have improved the company's gross margin. Supply chain costs fell almost 6% to $548.6 million in the three months ending June 18, increasing the gross margin to 39.5% compared to 36.3% in the same period last year.

Institutional Investors and Insider Activities:

Institutional investors, including Vanguard Group Inc, Blackrock Inc., and T. Rowe Price Investment Management, Inc., hold the majority of the company's shares. On the insider activity front, Andrew Charles Ballard, Director, sold 2,720 shares on May 2, 2023, while Sandeep Reddy, the Chief Financial Officer, received a stock award (grant) of 11,025 shares on March 9, 2023.

Market Strategy:

Domino's is significantly shifting its market strategy by forming partnerships with Uber Eats and Postmates. The primary focus is on attracting new customers and encouraging loyalty among existing ones. "Rather than sink money into digital marketing efforts, Domino's is going where the eyeballs are already looking," stated Senior analyst Zak Stambor from Insider Intelligence. The company also plans to roll out a new U.S. rewards program in September.

Option Trading Insight:

From an options trading perspective, DPZ's future appears uncertain. A recent call option, traded last on July 21, 2023, at 3:56 PM EDT, had a strike price of $190.00 with a last price of $195.20. This suggests a high level of uncertainty about DPZ's future stock price trajectory from the perspective of option traders.

DPZ Stock 52-Week Performance and Key Metrics:

Over the past 52 weeks, Domino's stock has demonstrated robust performance, with a range of $285.84 - $417.23. The stock has an average volume of 689,431, which increased to 1,255,651 in the most recent trading session. With a market capitalization of $13.824B, a P.E. ratio of 30.21, and an EPS of 12.95, Domino's showcases strong financial health. The company is set to report earnings on July 24, 2023.

DPZ Dividend and Volatility:

Domino's dividend yield is 1.25%, with a forward dividend of $4.84. The stock has a five-year monthly beta of 0.84, reflecting lower volatility than the market.

Revenue and Profit Margins:

Domino's reported revenue of $4.55B for the trailing twelve months and a net income of $466.07M. The company boasts a profit margin of 10.24% and an operating margin of 17.25%.

Insider Activities:

Insider activity is always a critical aspect to consider when evaluating a company's financial situation and future prospects. Notably, there has been some recent insider activity at Domino's. For instance, Andrew Charles Ballard, a Director at Domino's, sold 2,720 shares on May 2, 2023. Additionally, Sandeep Reddy, the Chief Financial Officer, received a stock award (grant) of 11,025 shares on March 9, 2023.

Institutional Holdings:

Shares of Domino's are primarily held by institutional investors. Institutions hold 98.46% of the company's shares, indicating substantial confidence in the pizza giant's long-term viability. The top institutional holders are Vanguard Group Inc, Blackrock Inc., and T. Rowe Price Investment Management, Inc.

Domino's Partnership with Uber:

Domino's strategic partnership with Uber Eats, operating under the stock symbol UBER on the New York Stock Exchange (NYSE), represents a significant development in its efforts to strengthen delivery capabilities and boost sales. This collaboration allows Domino's to leverage Uber Eats' advanced technology, providing a platform for approximately two-thirds of Domino's global operations. The partnership underlines Domino's commitment to maintaining its leading position in the worldwide food industry and sets the stage for potential collaborations with other ordering aggregators.

Revenue Analysis and Financial Health:

Although Domino's reported a 3.8% year-on-year decrease in revenue for Q2, primarily due to falling income from its supply chain operations and lower order volumes, the company has managed to navigate these challenges successfully. Easing supply chain pressures and lower food costs have helped to improve the company's gross margin. Notably, supply chain costs fell almost 6% to $548.6 million in the three months ending June 18, raising the gross margin to 39.5% compared to 36.3% in the same period last year. These figures indicate that despite some challenges, Domino's financial health remains strong.

Outlook:

Given the robust financial performance, strategic partnerships, and the continuous expansion of its store count and offerings, Domino's outlook remains optimistic. With the upcoming earnings report scheduled for July 24, 2023, investors and stakeholders will be looking for more insights into the company's current status and future direction.