Domino's: Mediocre Times Ahead For Pizza

Summary

• Domino's Pizza, Inc. is closer to a supply chain business than a store owner. The business operates several parts of the Domino's supply chain, with accretive monetization.
• The business has grown revenue well, alongside key KPIs such as EBITDA per location.
• Supply chain issues and greater interest are causing margins to contract, and we expect this to continue going forward.
• Management is incredibly savvy, with an impressive track record for long-term decision-making. Our overall view of the business is positive.
• The industry is highly competitive both in trading and financial results. We think Domino's Pizza, Inc. is an average performer, but its current valuation is ~-5% overvalued.

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Company overview:

Domino's Pizza, Inc. (NASDAQ:DPZ) is a pizza company operating internationally. The company offers takeaway and delivery pizzas from Domino's company-owned and franchised stores.

The business is arguably the largest pizza brand in the world, with an impressive slice

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.