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Papa John's Boosts Delivery Service Amid Coronavirus Woes

Zacks Equity Research

In order to boost delivery services amid the coronavirus outbreak, Papa John’s International, Inc. PZZA announced that it will hire up to 20,000 new restaurant team members. Moreover, the company is implementing additional health and safety precautions like measures related to enhanced restaurant sanitation and No Contact Delivery for the safety of its team members and customers. Nonetheless, the announcement is in sync with providing support to the communities it serves during such challenging times.

 

Papa John’s chief people and diversity officer Marvin Boakye stated, “We want to add talented team members to our Papa John’s family across the country to deliver food safely to our customers’ doorsteps. We are in the unique position as a restaurant that specializes in delivery and carryout  to help our communities through this crisis.”

 

Contactless Delivery Set to Gain Traction

 

With the rampant spread of the coronavirus pandemic across the globe, contactless delivery services look set to gain momentum. So far, the pandemic has infected at least 170,000 people and claimed more than 6,500 lives worldwide.

 

People are even hesitating to avail  door-to-door delivery services as they fear the person delivering the food might carry the COVID-19 infection.

 

This, in turn, prompted several online delivery operators in the United States to start contactless delivery services in order to prevent transmission of the virus between delivery drivers and customers. Further, the service will aid these operators to lure more customers on growing hygiene awareness.

 

Increased Focus on Delivery Services Bodes Well

 

Papa John’s continues to reinforce its commitment toward offering a better customer experience with its improved digital ordering process. The company further expanded its digital ordering capabilities with the launch of Facebook Instant Ordering and emerged as the first national pizza chain to do so.

 

It is also the foremost national restaurant chain to unveil a custom-ordering app for Apple TV, commence a nationwide digital rewards program and surpass 60% of the total U.S. sales via digital channels. 

 

Currently, the company has 100 corporate and franchise restaurants that enable customers to visually track their delivery on a map. Notably, its partnership with UberEATS as well as its existing, fastest-evolving door-to-door delivery service providers DoorDash and Postmates augurs well.

 

Meanwhile, Papa John’s continues to invest in direct customer delivery. Delivery currently covers 1,000 U.S. restaurants and nearly doubled from the last reported quarter. 

 

Shares of the company have gained 10.8% in the past year against the industry’s fall of 29.3%.

 

 

Zacks Rank & Other Key Picks

 

Papa John’s currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

Other better-ranked stocks in the same space include Cracker Barrel Old Country Store, Inc. CBRL, Brinker International, Inc. EAT and Chipotle Mexican Grill, Inc. CMG. Cracker Barrel sports a Zacks Rank #1 while Brinker International and Chipotle Mexican Grill carry the same Zacks Rank as Papa John’s.

 

Cracker Barrel has a trailing four-quarter positive earnings surprise of 7.8%, on average. The company’s earnings beat estimates in all the last four quarters.

 

2020 earnings for Brinker International are expected to rise 6.6%.

 

Chipotle Mexican Grill has an expected three-five year earnings per share growth rate of 19.3%.

 

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