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How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.
What if you'd invested in Domino's Pizza (DPZ) ten years ago? It may not have been easy to hold on to DPZ for all that time, but if you did, how much would your investment be worth today?
Domino's Pizza's Business In-Depth
With that in mind, let's take a look at Domino's Pizza's main business drivers.
Founded in 1960, Domino’s Pizza Inc., which delivers pizzas under the Domino’s Pizza brand, is a top player in the Quick-Service Restaurant or QSR Pizza category.
Through its subsidiaries, the company operates as a pizza delivery company in the United States and internationally, with 18,057 locations in more than 90 markets.
The company operates and reports through the following three business segments: U.S. stores, international franchise and supply chain.
U.S. stores (34.8% of total revenues in fiscal second-quarter 2021): The segment primarily consists of franchised stores but also have company-owned stores, which are used as sites for promotion of new products and improvement of operational efficiencies. As of Jun 20, 2021, the company owned and operated 6,426 stores across the United States.
International franchise (6.8%): Domino’s has a network of franchised stores in more than 90 international markets. As of Jun 20, 2021, the company had 11,631 international franchise stores. Revenues at this segment primarily gain from royalty payments generated by retail sales from franchised stores. Notably, most of the company’s international stores operate under master franchise agreements.
Supply chain (58.4%): The segment operates 19 regional dough manufacturing as well as food supply chain centers in the United States. It also has a center each for thin crust manufacturing, vegetable processing, and providing equipment and supplies to our U.S. and certain international stores.
Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in Domino's Pizza a decade ago, you're probably feeling pretty good about your investment today.
According to our calculations, a $1000 investment made in August 2011 would be worth $21,136.53, or a 2,013.65% gain, as of August 10, 2021. Investors should keep in mind that this return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 278.02% and the price of gold went up -7.37% over the same time frame.
Analysts are anticipating more upside for DPZ.
Shares of Domino's have outperformed the industry so far this year. The company reported second-quarter fiscal 2021 results, with earnings and revenues beating the Zacks Consensus Estimate. Moreover, the top and the bottom line increased 12.2% and 4.3% on a year-over-year basis, respectively. Notably, the company is benefiting from a solid digital ordering system and higher global retail sales. This along with focus on robust international expansion bode well. However, the coronavirus related woes persist. At the end of second quarter 2021, fewer than 175 stores (majority located in India) were temporarily shut due to the pandemic. The company announced that coronavirus pandemic will continue to hurt international markets for some time. Meanwhile, the company’s high debt level is a major headwind to tide over the ongoing crisis.
The stock has jumped 10.28% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 7 higher, for fiscal 2021; the consensus estimate has moved up as well.
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Dominos Pizza Inc (DPZ) : Free Stock Analysis Report
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