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On Tuesday, RBC Capital Markets maintained a positive outlook on Domino’s Pizza (NASDAQ:DPZ) shares, raising the price target to $550 from the previous $500 while keeping an Outperform rating on the stock. With the stock currently trading at $490.64, this represents potential upside according to RBC’s analysis. The adjustment follows a review of the company’s first-quarter performance, which presented a mixed set of results according to RBC Capital. According to InvestingPro data, 8 analysts have recently revised their earnings estimates upward for the upcoming period, with analyst targets ranging from $414 to $555.
The company’s international same-store sales (SSS) exceeded expectations, and Domino’s Pizza continues to expand its market share in the United States, despite a challenging environment for consumers. With a market capitalization of $16.8 billion and revenue growth of 5.07% over the last twelve months, the company maintains a strong market position. The completion of a significant number of store closures in Japan within the first quarter was also noted as a positive development. Additionally, the firm has reiterated its 2025 guidance, which includes expectations for international and U.S. same-store sales, unit growth, and an EBIT growth exceeding 8%, adjusted for foreign exchange. InvestingPro analysis shows the company has maintained dividend payments for 14 consecutive years, demonstrating consistent shareholder returns.
However, the report highlighted some areas of concern. The overall pizza category is feeling the effects of consumer weakness, particularly among low-income individuals. Despite its ongoing market share gains, Domino’s Pizza is not fully insulated from these broader industry challenges. Furthermore, RBC Capital analysts pointed out that while the full-year comparable sales guidance remains unchanged, the incorporation of DoorDash (NASDAQ:DASH) as a delivery option could be contributing to nearly one-third of the company’s U.S. same-store sales growth for the year.
In light of these factors, RBC Capital has revised its estimates for Domino’s Pizza and has increased the price target, signaling confidence in the company’s ability to navigate the current market conditions while sustaining growth. The raised price target reflects an anticipation of continued performance in line with the company’s strategic goals and market positioning.
In other recent news, Domino’s Pizza reported mixed results for its first quarter of 2025, with earnings per share surpassing some expectations at $4.33, beating estimates from Goldman Sachs and Visible Alpha Consensus Data. However, U.S. comparable sales saw a slight decline of 0.5%, which was below forecasts, while international sales outperformed with a 3.7% growth. Despite these mixed results, Domino’s maintained its full-year guidance, anticipating growth driven by new menu items like the Stuffed Crust Pizza and a partnership with DoorDash. Analyst opinions varied, with Barclays (LON:BARC) lowering its price target to $420 due to concerns over U.S. sales, while Goldman Sachs and Evercore ISI remained optimistic, maintaining a Buy rating and raising the price target to $530 and $520, respectively. Evercore ISI cited potential market share gains and projected growth in same-store sales as reasons for their positive outlook. Wells Fargo (NYSE:WFC) adjusted its target to $465, acknowledging the company’s defensive nature and potential catalysts in the coming quarters. Stifel also raised its target to $510, highlighting Domino’s resilience and strategic initiatives aimed at maintaining growth in a challenging market. These developments reflect a complex landscape for Domino’s Pizza, as it navigates both domestic challenges and international opportunities.
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