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On Tuesday, Bernstein SocGen Group updated its outlook on Domino’s Pizza (NASDAQ:DPZ) shares, increasing the price target to $460 from the previous $440 while maintaining a Market Perform rating. With the stock currently trading at $494.50 and a market capitalization of $16.88 billion, the firm’s analysis indicates that Domino’s is effectively managing its operations amidst economic challenges. According to InvestingPro data, 8 analysts have recently revised their earnings estimates upward for the upcoming period, suggesting growing confidence in the company’s outlook.
The adjustment follows Domino’s recent financial disclosures, which revealed that external factors such as tariffs have not significantly affected the company’s performance. The company has maintained strong financials, with revenue growing at 5.07% and an impressive return on assets of 34.24%. Additionally, the impact of third-party delivery services, also known as aggregators marketplaces, has been revised to a 50% incrementality rate.
Bernstein’s analyst Danilo Gargiulo highlighted the company’s ability to navigate through the current macroeconomic landscape without altering its financial guidance. Gargiulo’s statement praised Domino’s for its strategic handling of the business: "The biggest learnings from an otherwise in-line quarter were that tariffs are not materially impacting the business, incrementality of aggregators marketplaces was reduced to 50% and that guidance was reiterated despite challenging macroeconomic environment."
The analyst also pointed out that Domino’s has been gaining market share and maintaining supply chain efficiency, which are critical factors for the company’s stability. Gargiulo noted, "The market share gains and supply chain productivity discipline suggest that Domino’s is ‘controlling the controllables’ in times of uncertainty."
Domino’s Pizza’s steadfast approach in such an uncertain economic climate has been recognized by Bernstein as a testament to the company’s robust operational discipline. The updated price target reflects confidence in Domino’s ongoing strategies to manage external pressures while continuing to grow its market presence. InvestingPro analysis shows the company maintains a "GOOD" overall financial health score, with particularly strong profitability metrics. For deeper insights into Domino’s valuation and growth prospects, investors can access comprehensive Pro Research Reports covering 1,400+ top stocks on InvestingPro.
In other recent news, Domino’s Pizza reported its first-quarter earnings for 2025, surpassing market expectations with an earnings per share (EPS) of $4.33, compared to the consensus estimate of $4.06. This strong performance was driven by a gain on investment, robust international sales, and reduced general and administrative expenses, although U.S. same-store sales fell slightly short of projections. Following this, BMO Capital Markets raised its price target for Domino’s to $540, maintaining an Outperform rating, while Loop Capital increased its target to $564, citing strong international growth. RBC Capital Markets also raised its target to $550, highlighting Domino’s market share expansion in the U.S. despite broader industry challenges.
Conversely, Barclays (LON:BARC) revised its price target down to $420, maintaining an Underweight rating due to weaker-than-expected U.S. sales and earnings growth. Despite these mixed results, Domino’s reiterated its 2025 guidance, projecting 6% growth in global retail sales and an 8% increase in operating income. The company’s strategic initiatives, such as the introduction of Parmesan Stuffed Crust pizza and a partnership with DoorDash (NASDAQ:DASH), are expected to drive sales growth in the coming months. Analysts from UBS and BMO Capital remain optimistic about Domino’s ability to achieve its financial goals, particularly in the U.S. market. Investors will be closely monitoring Domino’s progress as it executes these strategies and aims to enhance shareholder value.
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