Domino’s Pizza stock rating reiterated at Buy by BTIG on strong sales

Investing.com - BTIG has reiterated its Buy rating and $530.00 price target on Domino’s Pizza (NASDAQ:DPZ), currently trading at $465.95, following the company’s quarterly earnings report, which showed accelerating domestic same-store sales. According to InvestingPro data, the stock has delivered a 17% return over the past year, though it’s currently trading at a relatively high P/E ratio of 26.5x.

The pizza chain delivered solid results with sales growth on both one-year and two-year bases, primarily driven by its new Stuffed Crust offering. The company also reported significant upside on operating profit in the quarter, maintaining its strong profitability with a gross margin of 28.4% and generating $573 million in levered free cash flow over the last twelve months.

BTIG noted that Domino’s recent partnership with DoorDash (NASDAQ:DASH) provided only a modest benefit to results given the timing of the rollout, but expects this contribution to increase in coming quarters.

One notable development from the earnings call was management’s apparent openness to adding fryers to restaurants, which would allow Domino’s to compete more aggressively in the chicken and wing category. BTIG characterized this as a change in tone from previous management statements.

BTIG expressed confusion about the stock’s negative reaction to the earnings report, suggesting it might reflect an overly short-term focus rather than the strong fundamentals and what the firm called "more realistic-looking guidance." For deeper insights into DPZ’s valuation and over 30 key financial metrics, including Fair Value estimates and growth projections, check out the comprehensive research available on InvestingPro, where you’ll find expert analysis and 10 additional ProTips about the company’s financial health.

In other recent news, Domino’s Pizza Inc. reported its second-quarter 2025 earnings, which fell slightly below market expectations. The company posted an earnings per share (EPS) of $3.81, missing the forecasted $3.94 by 3.3%. However, revenue was in line with expectations at $1.15 billion. Despite the earnings miss, Domino’s experienced a 5.6% growth in global retail sales, supported by a 3.4% rise in U.S. same-store sales and the addition of 30 net new stores. Additionally, the company completed a national rollout with DoorDash, expanding its delivery options. Domino’s also repurchased 316,000 shares for $150 million during the quarter. Looking ahead, the company expects U.S. same-store sales to grow by 3% for the year, with international growth projected at 1-2%. The company plans to open over 175 net new stores globally. Domino’s continues to focus on strengthening its market position through strategic initiatives and partnerships.

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