JFrog stock rises as Cantor Fitzgerald maintains Overweight rating after strong Q2
On Friday, UBS analyst Dennis Geiger maintained a Neutral rating on Papa John’s (NASDAQ:PZZA) stock with a steady price target of $45.00. According to InvestingPro data, analyst targets range from $45 to $67, with the stock currently trading at $44.84. Despite a strong YTD return of 15.57%, Papa John’s appears undervalued based on InvestingPro’s Fair Value analysis. Geiger highlighted the company’s fourth-quarter earnings call, noting management’s confidence in strategic initiatives aimed at driving traffic recovery and spurring profitable growth. Papa John’s has outlined broad-based plans that include value offerings, menu innovation, and marketing efforts expected to enhance the brand’s positioning and bolster recovery through 2025.
The company’s financial guidance for 2025 projects flat to 2% growth in same-store sales (sss) in North America and internationally, compared to consensus estimates of 0.7% in North America and 0.8% internationally. However, the adjusted EBITDA forecast of $200-220 million fell below the consensus estimate of $220.7 million, reflecting increased marketing investments and general and administrative expenses. InvestingPro data shows the company maintains a 20.23% gross profit margin and has consistently paid dividends for 13 consecutive years, with a current yield of 3.92%.
Papa John’s also announced a forthcoming review of its North American commissary network, which may uncover potential savings and opportunities for improved returns. Geiger pointed out that while the plans and priorities are set to support a recovery, any upside is contingent on a positive shift in North American same-store sales trends and an acceleration in global unit growth.
Geiger concluded by noting that at approximately 10 times the projected 2026 EBITDA, the risk/reward ratio for Papa John’s stock is balanced. He emphasized that macroeconomic pressures continue to pose a risk and that evidence of progress against the company’s turnaround plans would be necessary before adopting a more constructive stance on the stock. InvestingPro subscribers can access additional insights through the comprehensive Pro Research Report, which includes detailed financial health metrics, showing Papa John’s currently maintains a FAIR overall financial health score.
In other recent news, Papa John’s International Inc. reported a robust performance for the fourth quarter of 2024, surpassing analyst expectations. The company achieved earnings per share (EPS) of $0.63, beating the forecast of $0.51, and reported revenue of $530.77 million, exceeding the anticipated $516.29 million. Despite the strong quarterly results, Papa John’s provided guidance for 2025 that fell short of consensus forecasts, particularly in unit growth and EBITDA, as noted by BMO Capital Markets. Analyst Andrew Strelzik from BMO Capital adjusted the price target for Papa John’s stock to $60 from $63, maintaining an Outperform rating due to the company’s long-term potential and current discounted valuation. The international markets, including the Middle East and UK, demonstrated strong growth, while North American sales faced challenges. Papa John’s strategic initiatives, such as cost reductions and a focus on international expansion, contributed to its financial performance. Looking ahead, the company plans to invest up to $25 million in marketing and aims to open 85-115 new restaurants in North America in 2025.
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