Papa John's: Papa Rewards Overhaul Already Paying Off

Pedro Goulart
463 Followers
(19min)

Summary

  • Papa John's is undergoing a turnaround with improvements in its loyalty program and a focus on 1P channels, showing positive short-term results.
  • Despite ongoing acquisition talks with Irth Capital, the company's transformation efforts are paying off, with better traffic and increased Papa Rewards redemptions.
  • Papa John's aims to simplify its menu and reduce construction costs to attract more franchisees and compete effectively with other QSR pizza chains.
  • I maintain a 'Buy' rating at $64, with the potential for a 'Strong Buy' if the price drops to the early-$40s, anticipating sequential improvements in FY 2025.

Logotipo de Papa John na frente de seu Fast Food local em Toronto, Ontário. Papa Johns pizza é um braind americano de pizza e pizzaria restaurantes

BalkansCat/iStock Editorial via Getty Images

Acquisition or Turnaround? When in Doubt, I'll Choose Both

Despite negotiations with Irth Capital Management apparently being ongoing, Papa John's (NASDAQ:PZZA) did not touch on the subject during his earnings call.

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This article was written by

Pedro Goulart
463 Followers
I am an Equity Analyst and Accountant specializing in restaurant stocks, with a solid foundation in Business Administration and Accounting, complemented by an MBA in Forensic Accounting and Controllership. As the founder of Goulart's Restaurant Stocks, I lead a company focused on analyzing restaurant stocks in the U.S. market. Our coverage spans multiple segments, including QSR, fast casual, casual dining, fine dining, and family dining. We employ advanced analytical models and specialized valuation techniques to provide detailed insights and actionable strategies, helping investors make informed, strategic decisions. In addition to my work in the financial market, I actively engage in academic and journalistic initiatives. I contribute regularly to institutions that promote individual and economic freedom, such as the Mises Institute, Mises Brasil, and SNB&CHF. Previously, I was a columnist for Investing, where I discussed topics like monetary policy, financial education, and financial modeling, aiming to make these subjects accessible to a broader audience.

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.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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