Domino's Pizza Enterprises Limited (DMP) AI Stock Analysis

• Market Cap: $1.99B
• Dividend Yield: 5.03%
• Average Volume (3M): 491.26K
• Price to Earnings (P/E): 120.2
• Beta (1Y): 1.06
• Revenue Growth: -8.04%
• EPS Growth: -54.44%
• Country: AU
• Employees: 88,000
• Sector: Consumer Cyclical
• Sector Strength: 59
• Industry: Restaurants
• EPS (TTM): -0.24
• Shares Outstanding: 94,448,290
• 10 Day Avg. Volume: 582,647
• 30 Day Avg. Volume: 491,257
• PEG Ratio: -13.08
• Price to Book (P/B): 9.46
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 37.52
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $27.46
• Price Target Upside: 28.50% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 54 Neutral
• Price Target: AU$22.50 ▲(5.29%Upside)

Domino's Pizza Enterprises Limited receives a moderate score driven by strong financial performance and efficient cash flow management. However, technical analysis indicates negative market momentum and the stock appears overvalued based on its high P/E ratio. The dividend yield provides some support to the valuation.

Positive Factors

Cost Efficiency

The announcement of an incremental cost out of A$14.9mn in store optimization and cost base simplification is expected to offset moderate trading conditions.

Valuation

The DCF valuation has increased, indicating a potentially higher future value for the company.

Negative Factors

European Market Challenges

There are concerns about Domino's performance in France, with a need for improved franchise partner engagement and consumer perception.

Market Uncertainty

The target price was lowered due to uncertainty in Europe, with Domino's closing stores in France and facing challenges in store rollout.

Profitability Challenges

The closure of an additional 205 loss-making stores indicates ongoing challenges in maintaining profitability.

Sales Performance

Recent initiatives in France have not shown significant improvement in sales trends, raising doubts about future advertising strategies.

Domino's Pizza Enterprises Limited Business Overview & Revenue Model

Company Description

Domino's Pizza Enterprises Limited operates retail food outlets. The company holds franchise rights for the Domino's brand in Australia, New Zealand, Belgium, France, the Netherlands, Japan, Germany, Luxembourg, Denmark, and Taiwan. It operates a network of 3,396 stores. Domino's Pizza Enterprises Limited was founded in 1983 and is based in Brisbane, Australia.

How the Company Makes Money

Domino's Pizza Enterprises Limited primarily generates revenue through its network of company-owned and franchised stores. The company earns money through direct sales in its owned stores and collects royalties and fees from its franchised stores based on their sales performance. Additionally, DMP benefits from supply chain operations, providing ingredients and products to its franchisees, which ensures quality consistency across its network. Key revenue streams also include delivery and service charges, alongside strategic marketing partnerships that enhance its brand visibility and customer engagement. Factors contributing to its earnings include technological innovations in online ordering and delivery systems, efficient supply chain management, and strong brand loyalty fostered through customer-centric initiatives.

Domino's Pizza Enterprises Limited Financial Statement Overview

Summary

Domino's Pizza Enterprises Limited shows strong financial performance with consistent revenue growth and profitability, and excellent cash flow management. However, high leverage as indicated by the Debt-to-Equity Ratio poses potential risks that require monitoring.

Income Statement

Domino's Pizza Enterprises Limited has shown a consistent revenue growth trajectory, with a Revenue Growth Rate of 1.08% from 2023 to 2024. The Gross Profit Margin is robust at 56.01%, and the Net Profit Margin has improved to 4.05%, indicating better cost management. The EBIT Margin stands at 10.79%, and the EBITDA Margin is at 13.69%, reflecting strong operational efficiency. However, the slight dip in revenue growth rate may indicate a saturation point in the market, which needs to be monitored.

Balance Sheet

The Debt-to-Equity Ratio is 2.37, which is relatively high, indicating potential leverage risks. The Return on Equity (ROE) is 15.74%, showing a good return on shareholders' investment. The Equity Ratio is 23.51%, suggesting a moderate level of equity financing compared to total assets. While profitability is strong, the high leverage could pose financial risks if not managed properly.

Cash Flow

The company has demonstrated a solid Free Cash Flow Growth Rate of 42.33% from 2023 to 2024, indicating improved cash generation capabilities. The Operating Cash Flow to Net Income Ratio is 2.47, and the Free Cash Flow to Net Income Ratio is 1.53, both of which highlight efficient cash flow management. However, the negative investing cash flow suggests substantial investment activities, which could impact future liquidity.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
2.27B	2.37B	2.34B	2.27B	2.19B	1.90B
	Gross Profit
721.45M	731.50M	587.23M	634.83M	626.62M	539.30M
	EBIT
427.19M	255.68M	179.84M	238.40M	265.69M	205.45M
	EBITDA
224.07M	324.55M	279.38M	383.75M	421.79M	348.21M
	Net Income Common Stockholders
15.76M	95.96M	40.57M	158.72M	184.01M	138.48M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
119.42M	87.65M	159.89M	76.88M	174.69M	245.68M
	Total Assets
2.66B	2.59B	2.88B	2.43B	2.35B	2.47B
	Total Debt
1.44B	1.44B	1.74B	1.41B	1.27B	1.48B
	Net Debt
1.32B	1.36B	1.58B	1.34B	1.09B	1.23B
	Total Liabilities
2.04B	1.98B	2.36B	2.01B	1.96B	2.08B
	Stockholders Equity
626.19M	609.55M	520.52M	421.96M	395.14M	393.37M
Cash Flow		Free Cash Flow
167.73M	146.78M	103.13M	-1.95M	230.51M	186.13M
	Operating Cash Flow
189.57M	236.97M	260.79M	190.12M	373.25M	311.41M
	Investing Cash Flow
-52.48M	-66.01M	-487.94M	-233.28M	-97.46M	-98.88M
	Financing Cash Flow
-136.02M	-239.09M	314.12M	-49.95M	-329.90M	-70.14M

Domino's Pizza Enterprises Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 21.37
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:DMP, the sentiment is Negative. The current price of 21.37 is below the 20-day moving average (MA) of 23.48, below the 50-day MA of 24.80, and below the 200-day MA of 29.11, indicating a bearish trend. The MACD of -1.11 indicates Positive momentum. The RSI at 29.43 is Positive, neither overbought nor oversold. The STOCH value of 15.85 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:DMP.

Domino's Pizza Enterprises Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	63 Neutral	$6.98B	11.41	2.80%	4.24%	2.68%	-24.94%
DMP	54 Neutral	$1.99B	120.16	2.09%	5.03%	-8.04%	-54.44%
CLLFF		$587.16M	17.44	12.25%	2.85%	―	―
RFGPF		$71.51M	16.90	4.31%	―	―	―
36S		€1.83M	―		―	―	―
MTO	79 Outperform	AU$183.04M	10.77	8.49%	6.45%	3.76%	-26.42%
GYG	61 Neutral	AU$2.96B	―	-1.13%	―	26.77%	51.19%

Domino's Pizza Enterprises Limited Corporate Events

Pinnacle Reduces Stake in Domino’s Pizza Enterprises

Pinnacle Investment Management Group Limited has reduced its stake in Domino’s Pizza Enterprises Limited, decreasing its voting power from 9.76% to 8.58%. This change in substantial holding reflects a shift in Pinnacle’s investment strategy and could influence market perceptions and stakeholder confidence in Domino’s Pizza.

The most recent analyst rating on (AU:DMP) stock is a Buy with a A$46.00 price target. To see the full list of analyst forecasts on Domino’s Pizza Enterprises Limited stock, see the AU:DMP Stock Forecast page.

Domino’s Pizza Enterprises Announces Change in Substantial Holder Interests

Domino’s Pizza Enterprises Limited, a leading player in the global pizza delivery and takeaway industry, has announced a change in the interests of a substantial holder. The notice indicates a shift in voting power and relevant interests among key stakeholders, including State Street Bank and Trust Company and other associated entities. This change could impact the company’s governance and decision-making processes, potentially affecting its strategic direction and stakeholder relationships.

Domino’s Director Increases Shareholding Through Dividend Reinvestment

Domino’s Pizza Enterprises Limited announced a change in the director’s interest, with Mark van Dyck acquiring 528 additional shares under the company’s Dividend Reinvestment Plan. This change reflects a minor adjustment in the director’s holdings, indicating continued confidence in the company’s financial strategies and potential growth, which may reassure stakeholders about the company’s stability and future prospects.

Domino’s Director Increases Stake Through Dividend Reinvestment

Domino’s Pizza Enterprises Limited announced a change in the director’s interest notice, specifically for Director Lynda O’Grady. The change involved an acquisition of shares through a Dividend Reinvestment Plan, increasing her total shareholding. This adjustment in shareholding reflects the director’s continued investment in the company, potentially signaling confidence in its future performance.

Domino’s Director Increases Stake Through Dividend Reinvestment

Domino’s Pizza Enterprises Limited announced a change in the director’s interest, with John James Cowin acquiring additional shares through Somad Holdings Pty Ltd. This acquisition, made under the Dividend Reinvestment Plan, reflects a strategic move that could influence the company’s shareholder dynamics and potentially impact its market positioning.

Domino’s Pizza Enterprises Limited Announces Change in Substantial Shareholding

Domino’s Pizza Enterprises Limited has experienced a change in the substantial holding of its shares. State Street Bank and Trust Company, along with its associates, has adjusted its voting power in the company, reflecting a shift in the ownership structure. This change in shareholding could have implications for the company’s governance and strategic decisions, affecting stakeholders’ interests and potentially influencing market perceptions.

Domino’s Pizza Enterprises Announces Quotation of New Securities

Domino’s Pizza Enterprises Limited has announced the application for the quotation of 1,944,985 ordinary fully paid securities on the Australian Securities Exchange (ASX). This move is part of a dividend or distribution plan, potentially impacting the company’s financial structure and offering new opportunities for investors. The announcement underscores Domino’s strategic financial maneuvers aimed at enhancing shareholder value and maintaining its competitive edge in the industry.

Domino’s Pizza Enterprises Expands Share Issuance to Bolster Market Position

Domino’s Pizza Enterprises Limited has issued over 1.9 million fully paid ordinary shares, with a portion allocated to shareholders through the Dividend Reinvestment Plan and the remainder under a DRP underwriting agreement with Morgan Stanley. This strategic move is part of the company’s ongoing financial management and compliance with the Corporations Act, potentially enhancing its market position and shareholder value.