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How is Papa John’s Expanding Its Business?

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Papa John’s operations

Having discussed same-store sales growth in the previous article, we’ll discuss another revenue driver in this article—unit growth. By the end of fiscal 2015, Papa John’s International (PZZA) was operating 4,983 restaurants, with 753 company-operated restaurants and 4,141 franchised restaurants.

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4Q15 unit growth

In 4Q15, the company added ten new company-owned restaurants in North America and refranchised two international restaurants. It increased its franchised restaurants in both the North American and international markets, by 17 and 82, respectively. In 4Q15, Papa John’s had 17 more company-operated restaurants and 213 more franchised restaurants than it did in 4Q14.

You could gain exposure to Papa John’s by investing in the iShares Russell 3000 ETF (IWV), which has invested 0.01% of its portfolio in Papa John’s. IWV has invested 0.58% in McDonald’s (MCD), 0.43% in Starbucks (SBUX), and 0.15% in YUM! Brands (YUM).

Outlook for 2016

PZZA, which is planning to open its 5,000th restaurant this summer, has plans to add 180 to 200 new restaurants in fiscal 2016. Earlier this year, the company opened its first restaurant in Israel and announced the signing of 100 restaurants around Madrid, Spain. The recent signing is in line with the company’s strategy to develop its business in Europe. The company stated that they are focused on key markets such as the United Kingdom, Latin America, and Russia.

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