The firm kept its $81 price target, citing increased menu prices and the pizza company being a less risky international play for investors in the near term due to its limited exposure to China.
Separately, TheStreet Ratings team rates DOMINO'S PIZZA INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate DOMINO'S PIZZA INC (DPZ) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we find that the company's profit margins have been poor overall."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 5.9%. Since the same quarter one year prior, revenues slightly increased by 8.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
- Net operating cash flow has increased to $24.59 million or 28.11% when compared to the same quarter last year. In addition, DOMINO'S PIZZA INC has also vastly surpassed the industry average cash flow growth rate of -68.88%.
- The gross profit margin for DOMINO'S PIZZA INC is currently lower than what is desirable, coming in at 31.37%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 8.53% trails that of the industry average.
- You can view the full analysis from the report here: DPZ Ratings Report