Published on 11 Apr 2024 on Zacks via Yahoo Finance

Domino's (DPZ) Rides on Strong Comps, Macro Challenges Ail

Domino's Pizza, Inc. DPZ will likely benefit from solid comps growth, a loyalty program and the Uber partnership. This and the emphasis on unit-expansion efforts bode well. However, uncertain macroeconomic environments are a concern.Let’s delve deeper.

Factors Driving Growth

Domino's continues to impress investors with solid global comps growth. During the fiscal fourth quarter, global retail sales (including total franchise and company-owned units) rose 4.9% on a year-over-year basis. The upside was driven by higher international store sales (up 5.2% year over year) and global net store growth. U.S. store sales increased 4.5% year over year. Without foreign-currency adjustments, global retail sales increased 4.9% from the prior-year quarter’s levels. At domestic company-owned stores, Domino’s comps gained 5.9% year over year. Domestic franchise store comps rose 2.6% year over year as well.The increase in U.S. same-store sales in the fiscal fourth quarter was driven by transaction growth from its new loyalty program, inclusive of a benefit from Emergency Pizza promotion, pricing of approximately 1% and a 0.4% sales mix from Uber. For the fiscal 2024, DPZ anticipates its U.S. comp to surpass the 3% long-term guide due to expected significant catalysts in Uber and loyalty.