Domino's 4Q14 Earnings: Income Rises But Profit Margins Fall (Part 12 of 14)
Shares dropped after earnings
Domino’s Pizza (DPZ) reported its earnings on December 24—before the market opened. Shares began trading at $103.50. This price was down 1% from the previous day’s close of $104.50. The day’s high and low were $106.50 and $102.10, respectively.
Share volume was ~1.6 million shares compared to the 90-day average daily volume of ~0.4 million shares. Domino’s closed 1% down at $103.5 from the previous day’s close, according to NASDAQ.
Upgrades and downgrades
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On February 24, Barclays maintained its “equalweight” rating for Domino’s Pizza with a price target of $103, which increased from the target of $86 in the previous quarter.
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Jefferies revised its rating to “hold” from a “buy” recommendation but increased the price target to $100 from its previous target of $93 on the same date.
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As of February 26, seven Wall Street analysts had a “buy” rating, nine had a “hold” rating, and one had a “sell” rating on Domino’s Pizza, with a consensus target price of $107.
1Q15 estimates
The Wall Street consensus estimates for Domino’s in Q1 are as follows.
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Adjusted earnings per share estimates are $0.80.
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Revenue estimates are $486 million.
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Estimates for operating profits are $91 million.
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Adjusted net income estimates are $45 million.
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Forecasts for Q4 earnings will likely be announced on April 23, 2015.
In the next part of this series, we’ll cover Domino’s Pizza’s enterprise value and why the stock may have done so well compared to its peers, like Pizza Hut—under the umbrella of Yum! Brands ( YUM )—Papa John’s (PZZA), and McDonald’s ( MCD ). Yum! and McDonald’s are also held by the C onsumer Discretionary Select Sector SPDR Fund ( XLY ) . XLY holds ~1.5% of YUM and ~4% of MCD.
Browse this series on Market Realist: