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Investing.com - RBC Capital maintained its Outperform rating and $550.00 price target on Domino’s Pizza (NASDAQ:DPZ) following the company’s second-quarter earnings results. According to InvestingPro data, the stock is currently trading above its Fair Value, with 13 analysts recently revising their earnings expectations upward for the upcoming period.
The pizza chain delivered better-than-expected same-store sales growth in both U.S. and international markets compared to consensus estimates, while also reporting earnings before interest and taxes that exceeded forecasts due to lower general and administrative expenses. The company maintains strong profitability metrics, with a return on assets of 32.56% and a gross profit margin of 28.51% over the last twelve months.
Despite the quarterly beat, Domino’s Pizza maintained its fiscal year 2025 same-store sales guidance, which RBC Capital suggests may contain "some degree of conservatism" that could provide upside potential.
The investment firm identified potential growth drivers including a stable or improving macroeconomic environment, along with continued performance from the company’s stuffed crust offering and its partnership with DoorDash (NASDAQ:DASH).
RBC Capital noted it is monitoring the impact and duration of these growth initiatives, acknowledging concerns about potentially slowing U.S. same-store sales growth into fiscal year 2026 after the company laps the introduction of stuffed crust and the DoorDash partnership.
In other recent news, Domino’s Pizza reported its second-quarter 2025 earnings, with earnings per share of $3.81, which did not meet the consensus estimate of $3.94. However, the company’s revenues slightly surpassed expectations by $2 million. Domino’s maintained its 2025 guidance, projecting approximately 8% operating income growth, driven by global retail sales growth in line with 2024. U.S. same-store sales grew by 3.4%, supported by increased traffic and pricing adjustments. Analysts from UBS and Benchmark have reiterated Buy ratings, with price targets set at $540, citing strong sales momentum and solid operating results. Loop Capital raised its price target to $574 while maintaining a Buy rating, despite the earnings per share falling short of their estimate. Wells Fargo (NYSE:WFC) increased its price target to $490, noting improvements in delivery and carryout sales. BMO Capital continues to rate the stock as Outperform with a $540 price target, despite mixed earnings results.
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