Domino's soars on beat, strong guidance
Domino’s posted a beat on earnings and revenue in its latest earnings report, but it but it withdrew its longterm guidance amid coronavirus uncertainty. Yahoo Finance's Brian Sozzi breaks down the details.
Video Transcript
ALEXIS CHRISTOFOROUS: It's time to talk a little pizza. We always have time to talk about that, right? Domino's out with its earnings report, and Brian Sozzi joining me now who's been looking over this report. Brian, US same-store sales grew 7.1% in the first four weeks of its second quarter. That sounds pretty good. But I'm looking at the stock action, and Domino's is down about 3% right now.
BRIAN SOZZI: Yeah, bizarre move, Alexis. The stock was initially-- it did pop on this results, as I think it should have. To your point, US same-store sales so far in the second quarter through April 19 up 10.6%. Let's keep in mind, a lot of the restaurants are not even open. They're making nothing right now.
We just talked to Chipotle's CFO Jack Hartung yesterday, and sales so far in April in the restaurants have fallen off a cliff because they're not open. America is now a delivery-only restaurant business, and Domino's looks to be leading that service.
I think that's why you're seeing the stock down though. They pulled their longer-term outlook. Makes sense. You have no visibility into your business right now.
ALEXIS CHRISTOFOROUS: Yeah, nobody is really offering any kind of guidance. Just to break down these numbers, they did beat on the top- and bottom-line earnings. Came in at $3.07 a share. Revenue topping $873 million.
And also we know that they have a strong digital platform, which is probably what's helping to drive some of these numbers. But they're also hiring right now amidst a time when a lot of people are furloughing or laying workers off, right, Brian?
BRIAN SOZZI: Right. It's Domino's. It's Papa John's. It's even Yum! Brands. These companies are hiring to deliver us the food that we need.
And I will just add this to. If Domino's is seeing a 10.6% same-store sales increase in the US through April, imagine how sit-down restaurants are doing right now. I think some of the earnings reports you will hear from a DineEquity or an Applebee's owner will be shocking in a couple weeks. They will be absolutely shocking.
ALEXIS CHRISTOFOROUS: That they will. And actually Domino's out today saying it is hiring 10,000 additional workers to meet the higher demand. Really a tale of two stories for a lot of the restaurant industry, Brian.
