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Domino’s Pizza missed estimates but stock still rose on same strong store sales

Domino’s Pizza missed estimates but stock still rose on same strong store sales

Written by Sinad Karahimetovic

Shares of Domino’s Pizza (NYSE:) traded more than 5% higher today after the company reported third-quarter results.

DPZ averaged earnings per share of $2.79 on revenue of $1.07 billion, compared to analyst consensus of $2.98 on sales of $1.07 billion. Local comparable store sales rose 2%, better than the average analyst estimate of 1.11%. However, growth in the US was offset by a 1.8% drop in comparable international sales, which was worse than the expected 1.2% decline.

Domino’s said it opened 224 new stores this quarter, well below the 263 analyst consensus. The company also reaffirmed its previous 2022 financial guidance for food basket pricing.

Stifel analysts commented:

“We were pleased with the performance of the SRS amid increased consumer pressure. We believe the strength of the stock this morning reflects an oversold situation, and investors are looking forward to easier comparisons now with an uncertain quarter behind.”

Goldman Sachs analysts added:

“We expect stocks to react favorably to third-quarter print, particularly in terms of better-than-expected trends for US SSS benchmarks and location in print; however, view lower unit growth and margins as potential limiting factors.”

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