6 Domino's Pizza Analysts On Earnings: 'We Believe This Updated Financial Outlook Incorporates Ongoing Headwinds'

Shares of Domino's Pizza Inc DPZ declined in Friday’s early session after the company reported quarterly earnings.

Bernstein on Domino's Pizza

Analyst Danilo Gargiulo reaffirmed an Underperform rating and price target of $334.

“DPZ adjusted EPS of $4.43 was 46 cents above consensus ($3.97), primarily driven by refranchising gain and lower effective tax rate, despite comp miss,” Gargiulo said in a note. 

KeyBanc Capital Markets on Domino's Pizza

Analyst Eric Gonzalez reaffirmed a Sector Weight and on the stock.

The company’s results included “better than expected EPS ($4.43 vs. consensus of $3.95 and KBCM $3.85), largely due to a $0.46 gain from the sales of company-owned units,” Gonzalez wrote.

“Both Domestic and International segment SSS trends fell short of consensus (and likely investor) expectations, and the Company revised its two- to three-year global retail sales growth and unit growth outlook by 1 point and 2 points, respectively, citing slowing delivery demand,” the analyst added.

Morgan Stanley on Domino's Pizza

Analyst Brian Harbour reiterated an Overweight rating while reducing the price target from $430 to $405.

“Numbers move lower on reduced unit growth, sales expectations, with U.S. delivery the main driver but other cracks in the business today,” Harbour stated.

“We think there's an increased focus on addressing these, but with patience required, and investor focus on unit growth stability, delivery dynamics,” he added.

Check out other analyst stock ratings.

Stephens on Domino's Pizza

Analyst Joshua Long maintained an Overweight rating while reducing the price target from $335 to $300.

“The biggest pressure point came from a reduction in the company's global retail sales and net unit growth algorithms (with 2023 expected to be at the low-end of both metrics) reflecting macro headwinds on the U.S. delivery business,” Long said in a note.

“We were encouraged to see the gap between top quintile stores and bottom quintile stores narrow in the quarter,” he added.

Wedbush on Domino's Pizza

Analyst Nick Setyan reiterated an Outperform rating while slashing the price target from $400 to $365.

While announcing disappointing fourth-quarter results, Domino’s Pizza “lowered its previous 2-3 year outlook of 6%-10% annual global retail sales growth to 4%-8% and its previous annual global net unit growth outlook of 6%-8% to 5%-7%,” Setyan stated. “2023 is expected to be at the low end of each of these targets,” he added.

Oppenheimer on Domino's Pizza

Analyst Brian Bittner reaffirmed an Outperform rating and price target of $375.

“We believe this updated financial outlook incorporates ongoing headwinds to its delivery business and decelerated unit openings domestically,” Bittner said in a note.

“Following the stock's 12% post-earnings pullback, we will more intensely search for an actionable catalyst, as DPZ has become more intriguing at current levels,” he added.

DPZ Price Action: Shares of Domino's Pizza declined by 1.46% to $303.50 at the time of publication Friday.

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