How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in Domino's Pizza (DPZ) ten years ago? It may not have been easy to hold on to DPZ for all that time, but if you did, how much would your investment be worth today?
Domino's Pizza's Business In-Depth
With that in mind, let's take a look at Domino's Pizza's main business drivers.
Founded in 1960, Domino’s Pizza Inc., which delivers pizzas under the Domino’s Pizza brand, is a top player in the Quick-Service Restaurant or QSR Pizza category.
Through its subsidiaries, the company operates as a pizza delivery company in the United States and internationally, with 20,008 locations in more than 90 markets.
The company operates and reports through the following three business segments: U.S. stores, international franchises and supply chain.
U.S. stores (33% of total revenues in second-quarter fiscal 2023): The segment primarily consists of franchised stores but also has company-owned stores, which are used as sites for the promotion of new products and improvement of operational efficiencies. As of Jun 18, 2023, the company owned and operated 6,735 stores across the United States.
International franchise (6.9%): Domino’s has a network of franchised stores in more than 90 international markets. As of Jun 18, 2023, the company had 13,470 international franchise stores. Revenues at this segment primarily gain from royalty payments generated by retail sales from franchised stores. Notably, most of the company’s international stores operate under master franchise agreements.
Supply chain (60.1%): The segment operates 19 regional dough manufacturing and food supply chain centers in the United States. It also has a center each for thin crust manufacturing, vegetable processing, and providing equipment and supplies to our U.S. and certain international stores.
While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Domino's Pizza ten years ago, you're probably feeling pretty good about your investment today.
According to our calculations, a $1000 investment made in November 2013 would be worth $5,297.35, or a gain of 429.73%, as of November 24, 2023, and this return excludes dividends but includes price increases.
The S&P 500 rose 152.48% and the price of gold increased 53.90% over the same time frame in comparison.
Analysts are forecasting more upside for DPZ too.
Domino's shares have outperformed the industry so far this year The company reported fiscal third-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate by 27.1% and grew year over year. It is benefiting from solid global expansion, sales-boosting initiatives, menu innovation and digital advancements. During the quarter, global retail sales rose 5.3% year over year, thanks to higher international store sales and global net store growth. Also, the company launched its new loyalty program, Domino's Rewards, and disclosed the Emergency Pizza promotion. Earnings estimates for fiscal 2023 have increased in the past seven days, depicting analysts’ optimism. However, revenues missed the consensus estimate by 2.3% and declined year over year. Dismal supply chain and U.S. company-owned stores’ revenues drove the downtrend.
The stock has jumped 6.81% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 12 higher, for fiscal 2023; the consensus estimate has moved up as well.
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