Domino's Pizza (DPZ) profit jumps 21.5% in Q3 on strong global sales

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 Domino's Pizza (DPZ) profit jumps 21.5% in Q3 on strong global sales
Image source: Billy F Blume Jr,Shutterstock

Highlights

  • Domino's Pizza, Inc (NYSE: DPZ) revenue rose 3.1% YoY to US$30.3 million in the quarter.

  • Its net income surged 21.5% YoY to US$21.3 million, driven by higher income from global franchise operations and tax benefits.

  • Revenue growth of its American franchises partially offset the decline in the same-store sales in the US

World's largest pizza company Domino's Pizza, Inc. (NYSE: DPZ) on Thursday reported a third-quarter net income of US$21.3 million, or a 21.5% YoY jump, helped by solid global retail sales.

Announcing the results, Domino's Pizza CEO Ritch Allison said the company saw strong global retail sales during the quarter. The US same-store sales were up 15.6%, and international same-store sales rose 15.0% on a two-year basis, Allison said. However, its US same-store sales declined by 1.9% YoY.

Allison said that Domino's franchisees continued to attract customers around the world. As a result, Domino's global retail sales jumped 10.0% YoY, while the same-store sales increased 8.8% YoY in the quarter.

The company's store openings rose to 323, including 45 in the US and 278 internationally during the July-to-September period.

Buoyed by the results, on Oct 12, its Board of Directors announced a quarterly dividend of US$0.94 per share to shareholders of record as of Dec 15. The payment due date is Dec 30.

Domino's third-quarter performance

The pizza company’s revenue rose 3.1% YoY to US$30.3 million in the quarter on account of higher global retail sales. The company noted the decline in the same-store sales in the US was partially compensated by the revenue growth of its US franchises during the quarter.

The company’s net income surged 21.5% YoY to US$21.3 million, driven by higher income from global franchise operations and higher tax benefits. In addition, the diluted EPS rose to US$3.24 from US$2.49 in the third quarter of 2020, representing a 30.1% increase year-over-year.

Also Read: Wells Fargo (WFC), Morgan Stanley (MS) Q3 profits beat estimates

Domino's net income surged 21.5% YoY to US$21.3 million, driven by higher income from global franchise operations and tax benefits.

Source: Pixabay

Also Read: Bank of America’s (BAC) Q3 profits beat forecast, deposits up 15%  

Stock performance

The stock was up 1.88% to US$485.25 at 1:22 pm ET. DPZ’s 52-week highest and lowest prices were US$548.72 and US$319.71, respectively.

Domino's current market cap is US$17.98 billion. The P/E ratio is 39.35, and the forward P/E one year is 34.76. In addition, its EPS is US$12.40, and the annualized dividend is US$3.76.

Also Read: UnitedHealth (UNH) raises guidance on strong Q3 growth, revenue up 11%

Bottomline

The food and restaurant sector has been on a recovery path after witnessing widespread disruptions during the pandemic. Some of the companies have made remarkable progress over the past two quarters. However, investors should evaluate the companies carefully before investing in stocks.

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