In a report released today, Nick Setyan from Wedbush maintained a Buy rating on Papa John’s International (PZZA – Research Report), with a price target of $60.00.
Nick Setyan has given his Buy rating due to a combination of factors that suggest a positive outlook for Papa John’s International. The company’s recent earnings per share exceeded expectations, driven by same-store sales growth that aligned closely with pre-announcement figures. Despite a decline in North American system same-store sales, the results were better than anticipated, and international sales showed a slight improvement. The adjusted operating margin also surpassed consensus estimates, indicating strong operational performance.
Setyan believes there are several catalysts that could support above-consensus same-store sales growth in the future. These include strategic pricing innovations, increased marketing investments, and enhancements in digital and loyalty programs. Additionally, the company is focusing on new product rollouts and operational improvements, such as investments in kitchen equipment and delivery services. As the year progresses, year-over-year sales comparisons are expected to become more favorable, further supporting the potential for growth. Consequently, Setyan views the current valuation as overly pessimistic and sees potential for reaccelerated growth in the medium to long term.
In another report released on February 13, Stephens also maintained a Buy rating on the stock with a $60.00 price target.