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Domino's (DPZ) Boosts Carryout Services to Gain Customers

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In a bid to boost its customer carryout experience, Domino's Pizza, Inc. DPZ recently announced the launch of Domino's Carside Delivery 2-Minute Guarantee. Following the announcement, shares of the company moved up 1.2% during trading hours on Jun 28.

Notably, the idea revolves around the guaranteed delivery of pizzas from the oven to the respective customer cars within 2 minutes. In case of inability to meet the deadline, the next pizza will be provided free of cost. Customers are required to place order via Domino's Carside Delivery online.

Meanwhile, to promote the initiative, the company has collaborated with DraftKings Inc. DKNG to launch the Domino's Carside Delivery 2-Minute Guarantee Over/Under Challenge. This allows customers to bet on the new promise and predict if Domino’s Carside Delivery nationwide will be quicker than two minutes, more or less than 80% of the time.

The free-to-play challenge will be initiated through Jul 12, 2021 on DraftKings' Daily Fantasy app and online platforms. Upon expiration, the winners will be entitled for a share in the cash prize of $200,000.

With respect to the initiative, Domino's executive vice president – chief marketing office, Art D'Elia, stated, "While Domino's is no stranger to guarantees, this is the first time DraftKings has created a betting pool based on a company's performance. We want to make every delivery to customers' cars an easy and fast experience, and if we don't, we're going to make it right. "

More Focus on Digital Ordering

The extended ways to order a pizza has kept Domino’s at the forefront of digital ordering and customer convenience. Moreover, other digital enhancements in terms of make ordering, selecting service methods, paying and tipping were implemented to boost consumer experience. During second-quarter 2020, the company initiated car-side delivery, enabling convenient and contact-free carryout experience for customers.

Meanwhile, the company continues to innovate aggressively across all aspects of its business — including GPS, e-bikes, AI in-store technology, great food as well as an evolving digital experience. Apart from this, enhanced make-line and cut-table technology and AI-enabled forecasting are being rolled out for better syncing demand with capacity. We believe that the initiatives are likely to enhance speed, accuracy and efficiency of services, going forward.

Price Performance

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Zacks Investment Research

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So far this year, shares of Domino’s have gained 19.4% compared with the industry’s 9.9% growth. Notably, the company is benefiting from a solid digital ordering system and higher global retail sales. Also, higher investment in technology-driven initiatives bodes well. Meanwhile, the company’s international growth continues to be strong and diversified across markets, courtesy of exceptional unit level economics. Nonetheless, earnings estimates for 2021 have moved up in the past 30 days, depicting analysts’ optimism regarding the stock’s growth potential.

Zacks Rank & Key Picks

Domino’s currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the same space include Chuy's Holdings, Inc. CHUY and Texas Roadhouse, Inc. TXRH, each sporting a Zacks Rank #1.

Chuy's Holdings has a trailing four-quarter earnings surprise of 127.6%, on average.

Texas Roadhouse has a three-five year earnings per share growth rate of 10%.

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Dominos Pizza Inc (DPZ) : Free Stock Analysis Report

Texas Roadhouse, Inc. (TXRH) : Free Stock Analysis Report

Chuys Holdings, Inc. (CHUY) : Free Stock Analysis Report

DraftKings Inc. (DKNG) : Free Stock Analysis Report

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