Domino's Pizza Inc

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DPZ : NYSE : Services
$167.87 up 1.83 | 1.1%
Today's Range: 167.11 - 168.72
Avg. Daily Volume: 571000.0
01/20/17 - 4:02 PM ET

Financial Analysis


DOMINO'S PIZZA INC's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. DOMINO'S PIZZA INC has weak liquidity. Currently, the Quick Ratio is 0.71 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has significantly decreased by 54.15% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)566.68484.7
EBITDA ($mil)109.6288.21
EBIT ($mil)100.9180.54
Net Income ($mil)47.2337.83


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)153.55123.53
Total Assets ($mil)676.61603.2
Total Debt ($mil)2230.761527.92
Equity ($mil)-1936.15-1255.95


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin32.2230.87
EBITDA Margin19.3418.19
Operating Margin17.8116.62
Sales Turnover3.543.51
Return on Assets30.2529.51
Return on Equity0.00.0
Debt Q3 FY16 Q3 FY15
Current Ratio1.151.45
Debt/Capital7.575.62
Interest Expense25.1819.98
Interest Coverage4.014.03


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)48.0854.65
Div / share0.380.31
EPS0.960.67
Book value / share-40.27-22.98
Institutional Own % n/a n/a
Avg Daily Volume574670.0583960.0

Valuation


BUY. DOMINO'S PIZZA INC's P/E ratio indicates a significant premium compared to an average of 30.60 for the Hotels, Restaurants & Leisure industry and a significant premium compared to the S&P 500 average of 25.41. Normally, for additional comaprison, we would look at the price-to-book ratio; however, this company's price-to-book ratio is negative making the value useless for comparisons. The current price-to-sales ratio is well above the S&P 500 average and above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, DOMINO'S PIZZA INC seems to be trading at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
DPZ 41.41 Peers 30.60   DPZ 26.89 Peers 15.94

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

DPZ is trading at a significant premium to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

DPZ is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
DPZ 32.43 Peers 31.23   DPZ 1.89 Peers 1.80

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

DPZ is trading at a significant premium to its peers.

 

Average. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

DPZ trades at a valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
DPZ NM Peers 7.45   DPZ 27.70 Peers 71.03

Neutral. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

DPZ's P/B is negative making this valuation measure meaningless.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, DPZ is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
DPZ 3.33 Peers 2.93   DPZ 13.03 Peers 4.86

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

DPZ is trading at a premium to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

DPZ has a sales growth rate that significantly exceeds its peers.

 

 

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