US stock futures edge lower after S&P 500 hits record high; PCE data in focus
On Friday, UBS analyst Dennis Geiger reaffirmed a Buy rating for Domino’s Pizza (NASDAQ:DPZ) shares, maintaining a $540.00 price target. Currently trading at $468.32 with a market capitalization of $16.2 billion, the stock has shown strong momentum with a 12.4% gain year-to-date. According to InvestingPro data, analyst targets for the stock range from $402 to $559. Geiger’s analysis suggests that Domino’s is on track for increased momentum in U.S. same-store sales (sss) throughout 2025, bolstered by various initiatives and anticipated stronger growth in new store openings. The company’s long-term earnings growth trajectory also appears solid, supported by a healthy 4.4% revenue growth and a strong financial health score of "GOOD" according to InvestingPro’s comprehensive analysis.
Looking ahead to the fourth quarter results due on February 24, Geiger expects investor anticipation for U.S. sss to range from flat to modestly positive, with consensus estimates around 1.6%. Although trends might be challenged at the start of the first quarter, with consensus estimates at 1.7% for Q1, the focus remains on the drivers that will support U.S. sales growth into 2025. These include the potential introduction of stuffed crust pizza and the addition of DoorDash (NASDAQ:DASH) as a third-party aggregator partner.
Geiger also noted that expectations for global expansion in 2025 might be tempered due to higher international store closures and fewer openings, including the closure of 205 underperforming stores by Domino’s Pizza Enterprises (DPE), 172 of which are in Japan. Despite these international pressures, the UBS analyst anticipates further market share gains for Domino’s in the U.S., driven by a strong catalyst path that could enhance sales momentum and potentially lead to multi-year earnings increases. This performance could result in valuation multiple expansion as Domino’s outperforms its quick-service restaurant peers, which are currently valued at approximately 24 times their expected 2026 earnings per share. The company currently trades at a P/E ratio of 28.6x and has maintained dividend payments for 13 consecutive years, with impressive dividend growth of 24.8% over the last twelve months. Get deeper insights into DPZ’s valuation and growth prospects with a InvestingPro subscription, which includes access to over 10 additional ProTips and comprehensive financial analysis.
In other recent news, Domino’s Pizza is set to release its fourth-quarter earnings soon, with analysts from RBC Capital Markets maintaining an Outperform rating and a price target of $500, expressing optimism about the company’s market share and potential partnerships. Loop Capital also reiterated its Buy rating with a $559 target, noting a slight deceleration in same-store sales growth toward the end of the quarter but highlighting a positive overall trajectory. Meanwhile, TD Cowen adjusted its price target for Domino’s to $490, down from $515, while maintaining a Buy rating, citing slight modifications in same-store sales forecasts and promotional strategies expected to drive growth.
A Midwest investment research firm has suggested a promising outlook for Domino’s in 2025, highlighting growth drivers such as menu innovations and third-party partnerships. This positive sentiment is echoed by the company’s strategic initiatives aimed at maintaining market share gains. Additionally, Domino’s announced the upcoming retirement of board member Diana F. Cantor, who will step down after nearly two decades of service at the 2025 Annual Meeting of Shareholders.
These developments reflect a mix of strategic adjustments and growth expectations that Domino’s Pizza is navigating, with analysts and investors closely watching the company’s performance and strategic direction.
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