DOMINO'S PIZZA INC (DPZ) Stock Fundamental Analysis
NASDAQ:DPZ - Nasdaq - US25754A2015 - Common Stock - Currency: USD
Taking everything into account, DPZ scores 5 out of 10 in our fundamental rating. DPZ was compared to 134 industry peers in the Hotels, Restaurants & Leisure industry. DPZ scores excellent on profitability, but there are some minor concerns on its financial health. While showing a medium growth rate, DPZ is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
DPZ had positive earnings in the past year.
In the past year DPZ had a positive cash flow from operations.
DPZ had positive earnings in each of the past 5 years.
DPZ had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
DPZ has a better Return On Assets (32.38%) than 99.25% of its industry peers.
Looking at the Return On Invested Capital, with a value of 389.78%, DPZ belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for DPZ is significantly above the industry average of 14.02%.
The last Return On Invested Capital (389.78%) for DPZ is above the 3 year average (227.47%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 32.38% | ||
| ROE | N/A | ||
| ROIC | 389.78% |
ROA(3y)30.95%
ROA(5y)30.95%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)227.47%
ROIC(5y)158.69%
1.3 Margins
With an excellent Profit Margin value of 12.84%, DPZ belongs to the best of the industry, outperforming 82.84% of the companies in the same industry.
In the last couple of years the Profit Margin of DPZ has grown nicely.
The Operating Margin of DPZ (18.56%) is better than 76.87% of its industry peers.
DPZ's Operating Margin has been stable in the last couple of years.
With a Gross Margin value of 39.50%, DPZ is not doing good in the industry: 63.43% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of DPZ has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.56% | ||
| PM (TTM) | 12.84% | ||
| GM | 39.5% |
OM growth 3Y1.41%
OM growth 5Y1.44%
PM growth 3Y1.95%
PM growth 5Y2.31%
GM growth 3Y0.46%
GM growth 5Y0.27%
2. Health
2.1 Basic Checks
DPZ has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for DPZ has been reduced compared to 1 year ago.
DPZ has less shares outstanding than it did 5 years ago.
DPZ has a better debt/assets ratio than last year.
2.2 Solvency
DPZ has an Altman-Z score of 2.32. This is not the best score and indicates that DPZ is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.32, DPZ is in the better half of the industry, outperforming 67.16% of the companies in the same industry.
DPZ has a debt to FCF ratio of 8.68. This is a slightly negative value and a sign of low solvency as DPZ would need 8.68 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 8.68, DPZ is doing good in the industry, outperforming 67.16% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 8.68 | ||
| Altman-Z | 2.32 |
ROIC/WACC51.49
WACC7.57%
2.3 Liquidity
A Current Ratio of 0.60 indicates that DPZ may have some problems paying its short term obligations.
DPZ has a Current ratio of 0.60. This is in the lower half of the industry: DPZ underperforms 69.40% of its industry peers.
A Quick Ratio of 0.56 indicates that DPZ may have some problems paying its short term obligations.
DPZ has a worse Quick ratio (0.56) than 68.66% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
DPZ shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.84%, which is quite good.
DPZ shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.77% yearly.
The Revenue has been growing slightly by 4.28% in the past year.
DPZ shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.40% yearly.
EPS 1Y (TTM)13.84%
EPS 3Y7.04%
EPS 5Y11.77%
EPS Q2Q%20.95%
Revenue 1Y (TTM)4.28%
Revenue growth 3Y2.6%
Revenue growth 5Y5.4%
Sales Q2Q%2.53%
3.2 Future
DPZ is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.74% yearly.
DPZ is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.64% yearly.
EPS Next Y7.47%
EPS Next 2Y8.26%
EPS Next 3Y8.75%
EPS Next 5Y7.74%
Revenue Next Year4.13%
Revenue Next 2Y5.35%
Revenue Next 3Y5.19%
Revenue Next 5Y5.64%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 25.93, DPZ can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of DPZ is on the same level as its industry peers.
The average S&P500 Price/Earnings ratio is at 26.32. DPZ is around the same levels.
The Price/Forward Earnings ratio is 23.12, which indicates a rather expensive current valuation of DPZ.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DPZ is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.13, DPZ is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.93 | ||
| Fwd PE | 23.12 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, DPZ is valued a bit more expensive than 70.90% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, DPZ is valued a bit cheaper than 64.18% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.02 | ||
| EV/EBITDA | 20.77 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates DPZ does not grow enough to justify the current Price/Earnings ratio.
DPZ has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.47
PEG (5Y)2.2
EPS Next 2Y8.26%
EPS Next 3Y8.75%
5. Dividend
5.1 Amount
DPZ has a Yearly Dividend Yield of 1.54%.
DPZ's Dividend Yield is a higher than the industry average which is at 3.59.
Compared to the average S&P500 Dividend Yield of 2.40, DPZ is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.54% |
5.2 History
On average, the dividend of DPZ grows each year by 32.15%, which is quite nice.
DPZ has been paying a dividend for at least 10 years, so it has a reliable track record.
DPZ has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)32.15%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
DPZ pays out 34.58% of its income as dividend. This is a sustainable payout ratio.
The dividend of DPZ is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP34.58%
EPS Next 2Y8.26%
EPS Next 3Y8.75%
452.15
+1.15 (+0.25%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners93.29%
Inst Owner Change-1.89%
Ins Owners0.41%
Ins Owner Change0.39%
Market Cap15.48B
Analysts77.3
Price Target524.29 (15.95%)
Short Float %5.31%
Short Ratio2.67
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.54% |
Yearly Dividend6.08
Dividend Growth(5Y)32.15%
DP34.58%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.98%
Min EPS beat(2)-1.25%
Max EPS beat(2)5.22%
EPS beat(4)3
Avg EPS beat(4)6.52%
Min EPS beat(4)-1.25%
Max EPS beat(4)13.76%
EPS beat(8)6
Avg EPS beat(8)7.13%
EPS beat(12)7
Avg EPS beat(12)4.34%
EPS beat(16)9
Avg EPS beat(16)2.63%
Revenue beat(2)0
Avg Revenue beat(2)-2.72%
Min Revenue beat(2)-3.16%
Max Revenue beat(2)-2.28%
Revenue beat(4)0
Avg Revenue beat(4)-2.4%
Min Revenue beat(4)-3.16%
Max Revenue beat(4)-1.46%
Revenue beat(8)0
Avg Revenue beat(8)-2.64%
Revenue beat(12)1
Avg Revenue beat(12)-2.27%
Revenue beat(16)2
Avg Revenue beat(16)-2.09%
PT rev (1m)0.41%
PT rev (3m)4.63%
EPS NQ rev (1m)-0.03%
EPS NQ rev (3m)-0.72%
EPS NY rev (1m)0%
EPS NY rev (3m)1.48%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.43%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)-0.42%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.93 | ||
| Fwd PE | 23.12 | ||
| P/S | 3.27 | ||
| P/FCF | 27.02 | ||
| P/OCF | 22.75 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 20.77 |
EPS(TTM)17.44
EY3.86%
EPS(NY)19.56
Fwd EY4.33%
FCF(TTM)16.74
FCFY3.7%
OCF(TTM)19.87
OCFY4.4%
SpS138.25
BVpS-114.27
TBVpS-119.19
PEG (NY)3.47
PEG (5Y)2.2
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 32.38% | ||
| ROE | N/A | ||
| ROCE | 485.85% | ||
| ROIC | 389.78% | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | 18.56% | ||
| PM (TTM) | 12.84% | ||
| GM | 39.5% | ||
| FCFM | 12.11% |
ROA(3y)30.95%
ROA(5y)30.95%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)227.47%
ROIC(5y)158.69%
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)283.54%
ROCE(5y)197.8%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y1.41%
OM growth 5Y1.44%
PM growth 3Y1.95%
PM growth 5Y2.31%
GM growth 3Y0.46%
GM growth 5Y0.27%
F-Score7
Asset Turnover2.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 8.68 | ||
| Debt/EBITDA | 3.96 | ||
| Cap/Depr | 121.79% | ||
| Cap/Sales | 2.27% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 70.38% | ||
| Profit Quality | 94.25% | ||
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | 2.32 |
F-Score7
WACC7.57%
ROIC/WACC51.49
Cap/Depr(3y)122.69%
Cap/Depr(5y)126.74%
Cap/Sales(3y)2.22%
Cap/Sales(5y)2.2%
Profit Quality(3y)88.99%
Profit Quality(5y)95.86%
High Growth Momentum
Growth
EPS 1Y (TTM)13.84%
EPS 3Y7.04%
EPS 5Y11.77%
EPS Q2Q%20.95%
EPS Next Y7.47%
EPS Next 2Y8.26%
EPS Next 3Y8.75%
EPS Next 5Y7.74%
Revenue 1Y (TTM)4.28%
Revenue growth 3Y2.6%
Revenue growth 5Y5.4%
Sales Q2Q%2.53%
Revenue Next Year4.13%
Revenue Next 2Y5.35%
Revenue Next 3Y5.19%
Revenue Next 5Y5.64%
EBIT growth 1Y3.06%
EBIT growth 3Y4.05%
EBIT growth 5Y6.91%
EBIT Next Year17.04%
EBIT Next 3Y10.4%
EBIT Next 5Y8.07%
FCF growth 1Y37.29%
FCF growth 3Y-2.94%
FCF growth 5Y4.47%
OCF growth 1Y33.12%
OCF growth 3Y-1.52%
OCF growth 5Y4.69%