Domino's Pizza Inc (DPZ, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $466.4, Domino's Pizza Inc has witnessed a daily gain of 1.74%, marked against a three-month change of 13.91%. A thorough analysis, underlined by the GF Score, suggests that Domino's Pizza Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 4/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 5/10
- Momentum rank: 10/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With high ranks in profitability, growth, and momentum, and a moderate GF Value rank, GuruFocus assigned Domino's Pizza Inc the GF Score of 93 out of 100, which signals the highest outperformance potential.
Understanding Domino's Pizza Inc Business
Domino's Pizza Inc is a dominant force in the global pizza market, with a market cap of $16.24 billion and sales of $4.48 billion. The company boasts an operating margin of 18.3%, reflecting its efficiency and profitability. As a restaurant operator and franchiser, Domino's Pizza Inc has nearly 20,600 global stores across more than 90 international markets as of the end of 2023. The firm's revenue streams include sales from company-owned stores, franchise royalties, and contributions from its extensive dough manufacturing and supply chain facilities. With approximately $18.3 billion in 2023 system sales, Domino's Pizza Inc stands as the largest player in the global pizza market, surpassing competitors like Pizza Hut, Little Caesars, and Papa John's.
Profitability Rank Breakdown
The Profitability Rank showcases Domino's Pizza Inc's impressive standing among its peers in generating profit. The company's Operating Margin has seen a steady increase over the past five years, with a notable rise to 18.3% in 2023. This upward trend is a testament to Domino's Pizza Inc's operational efficiency and its ability to maximize earnings.
The Piotroski F-Score further confirms Domino's Pizza Inc's solid financial situation, while the company's Predictability Rank of 4.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence in its financial health.
Growth Rank Breakdown
Domino's Pizza Inc's high Growth Rank reflects its commitment to business expansion. The company's 3-Year Revenue Growth Rate of 6.8% outperforms 62.35% of the companies in the Restaurants industry. Additionally, Domino's Pizza Inc has experienced a robust increase in EBITDA, with a three-year growth rate of 9.5 and a five-year rate of 12.7, highlighting its ability to sustain growth and profitability.
Next Steps
Considering Domino's Pizza Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors seeking to capitalize on such robust financial health and market leadership may find Domino's Pizza Inc an attractive option. The company's ability to innovate, adapt, and expand its global presence, coupled with its strong financial indicators, positions it favorably for future success.
GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
