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Papa John’s (NASDAQ:PZZA) stock jumped 7.5% Thursday following unconfirmed reports that Apollo and Irth Capital have made a takeover bid in the low $60 per share range. The pizza chain, currently valued at $1.7 billion, has seen strong momentum with a 29% gain year-to-date. According to InvestingPro analysis, the stock appears slightly undervalued at current levels.
Stifel reiterated its Hold rating and $38.00 price target on Papa John’s stock amid the market speculation. The research firm indicated it has no knowledge of any discussions or negotiations and cannot verify the accuracy of the reports. Analyst targets currently range from $38 to $66 per share, reflecting mixed sentiment about the company’s prospects.Want deeper insights? InvestingPro subscribers have access to 12 exclusive ProTips and comprehensive financial analysis for Papa John’s, helping investors make more informed decisions.
Stifel conducted a leveraged buyout analysis to assess what the pizza chain might be worth to a private financial buyer. The analysis suggested an offer in the low-$60 range, representing approximately 14.5 times the company’s estimated 2025 enterprise value to EBITDA multiple. Currently, Papa John’s trades at an EV/EBITDA of 10.7x, with EBITDA of $249 million for the last twelve months.
The research firm noted that such a valuation could potentially generate a roughly 20% five-year annualized return, but this would require several bullish scenarios. These include EBITDA growth through measures like general and administrative expense savings and increased financial leverage of 6.5 times compared to 3.4 times reported in the first quarter of 2025.
Stifel concluded that an offer in the low-$60 range would be compelling for existing Papa John’s investors, though the firm maintained its neutral stance on the stock with its unchanged price target.
In other recent news, Papa John’s has introduced a new Croissant Pizza, featuring a buttery braided crust, across several global markets, including the UAE, Korea, China, Chile, and Peru. The launch is complemented by a collaboration with fashion designer Colm Dillane, resulting in a limited-edition delivery bag that will debut at Paris Fashion Week. In leadership changes, Papa John’s has promoted Caroline Miller Oyler to Chief Administrative Officer, consolidating various business support functions under her oversight to drive efficiency and growth. Analysts at Stifel have maintained a Hold rating on Papa John’s stock, with a price target of $38.00, following a revision of their earnings per share forecast due to expected increases in expenses and tax rates. Meanwhile, Benchmark analyst Todd Brooks reaffirmed a Buy rating with a $50.00 price target, citing sequential improvements in sales and transactions, as well as the success of recent marketing strategies. Despite a decline in North American comparable sales in the first quarter, Papa John’s has observed improving sales trends, driven by initiatives like an overhauled loyalty program and new marketing campaigns. The company is optimistic about achieving flat to 2% growth in full-year North American comparable sales and plans to continue expanding its store footprint modestly through 2025.
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