Analyst John Ivankoe of J.P. Morgan maintained a Hold rating on Domino’s Pizza (DPZ – Research Report), retaining the price target of $440.00.
John Ivankoe has given his Hold rating due to a combination of factors impacting Domino’s Pizza’s performance. The company’s recent financial results have not met the high expectations set during their December 2023 analyst day, with U.S. same-store sales showing minimal growth and international expansion falling short of targets. The anticipated boost from partnerships like Uber has not significantly materialized, and while there is some optimism around the upcoming DoorDash launch and new product introductions like Stuffed Crust Pizza, these are not expected to significantly increase sales due to pricing and market saturation challenges.
Furthermore, the valuation metrics suggest that the current stock price does not present a compelling entry point. The free cash flow yield is aligned with other major quick-service restaurant chains, and a price closer to $400 would be more attractive for potential investors. The price target remains at $440, based on a projected earnings per share for 2028 and a consistent valuation multiple. Overall, the Hold rating reflects a cautious outlook, balancing the potential for future growth against current operational and market challenges.