- Domino’s Pizza Inc DPZ reported Q3 FY22 revenue grew 7.1% year over year to $1.068 billion, marginally beating consensus of $1.06 billion.
- Earnings per share of $2.79 missed consensus of $2.97.
- Stephen Analyst Joshua Long repeated an equal weight on Domino’s Pizza and a Price target $368.
- DPZ’s Q3 sales growth in the US exceeded his and Street’s estimates. However, the international competitions fell short of the forecast. The overlapping of the VAT holiday affected the international competitions.
- The total receipts corresponded to the estimates.
- The company’s own operating margin and adjusted EPS missed consensus.
- On the development side, Domino’s opened 24 and 201 net new units in the US and internationally, below estimates.
- Finally, after the third quarter ended, the company sold 114 US-owned stores in Arizona and Utah for $41.1 million.
- FY22 revised guidance reflected headwinds in foreign exchange rates, G&A and capital spending.
- On the call, the analyst will seek comment on indications of revenue dynamics, operational and strategic adjustments, and a discussion of demand stimulus plans.
- Cowen Analyst Andrew Charles reiterated a market performance and price target of $362.
- While he was pleased with better-than-expected US comps as investors braced for failure, restaurants net growth and earnings per share missed, while international comps fell between his estimate and consensus.
- On the call, he’ll be watching for greater openness to third-party adoption, although given a 90bps sequential acceleration in US comps on a 3-year basis, that seems unlikely.
- He will also be looking for comment on the exit rate of sales in the third quarter amid investor concerns in a boost week between August 15th and August 21st, shortly followed by an “inflation relief deal” scheduled for September 6th was introduced.
- Domino’s noted that the international decline was partly due to a UK sales tax holiday
- He noted the fort activities in India, DPZ’s most important international market by number of stores,…
