Domino’s price target raised to $450 by Oppenheimer as pizza chain added to ‘top picks’

Oppenheimer has increased its price target for Domino’s Pizza Inc. DPZ, -0.75% to $450, up from $427, and highlighted the pizza giant in its “top picks,” pointing to the positive influence of same-store sales. Oppenheimer analyst Brian Bittner highlighted Domino’s as an “under-recognized revival story leading into 2024″ in a note published on Tuesday. He suggests that Domino’s could outperform consensus expectations in 2024 due to factors that could drive positive earnings revisions, reinforce unit growth, and bolster investor confidence.

While Domino’s reported profits that surpassed expectations in its July second-quarter results, the revenue saw an unexpected dip. The company is set to announce its third-quarter results on Oct. 12. Bittner wrote, “For the past year and a half, we had a more conservative stance due to a series of downward revisions, which we believe have reached their lowest and will now see an upward trend.”

He added that while he doesn’t anticipate significant changes in the 3Q23 results due on 10/12, he looks forward to upcoming events, including a visit to Domino’s headquarters on 11/3, Investor Day on 12/7, and subsequent results. In the past month, Domino’s shares have seen a slight 0.8% dip, while the S&P 500 index’s SPX SPX, -1.16% has dropped by 3.6%.”

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Oppenheimer has revised its price target for Domino’s Pizza Inc. (DPZ) to $450, up from $427, and has included the pizza chain in its list of “top picks.” This decision is based on the favorable impact of same-store sales. In a recent note, Oppenheimer analyst Brian Bittner expressed optimism about Domino’s Pizza, referring to it as an “under-appreciated revival story” leading into 2024.

Bittner pointed out that their analysis indicates that same-store sales have identifiable drivers that could outperform consensus expectations in 2024. This could result in several positive outcomes, including earnings upgrades, confirmation of unit growth, and a restoration of investor confidence.

Despite Domino’s beating profit expectations in the second quarter, the company surprisingly experienced a decline in revenue. However, Oppenheimer believes that a downward revision cycle, which had previously tempered their enthusiasm, has now reached its low point and is poised to reverse.

Domino’s price target raised to $450 by Oppenheimer as pizza chain added to ‘top picks’

They do not anticipate any upside surprises in the third-quarter results, scheduled for release on October 12, but are looking forward to upcoming events, including a headquarters visit on November 3, an Investor Day on December 7, and future financial results. Over the past month, Domino’s Pizza shares have declined by 0.8%, in contrast to the S&P 500 index’s drop of 3.6%.

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