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What Analysts Expect from Pizza Companies’ Revenue in 2018

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Mar. 29 2018, Updated 9:03 a.m. ET

Domino’s Pizza

Analysts expect Domino’s Pizza (DPZ) to post revenue of $3.08 billion, which represents growth of 10.3% from $2.79 billion in 2017. The revenue growth is expected to be driven by positive SSSG (same-store sales growth) and the addition of new restaurants.

For the next three to five years, Domino’s management is expecting its SSSG to be in the range of 3.0%–6.0% for its domestic and international markets. Management is forecasting unit growth in the range of 6.0%–8.0% per year. SSSG is expected to be driven by enhancement of technological advancements and increased sales from its Piece of the Pie Rewards loyalty program.

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Papa John’s

Analysts expect Papa John’s (PZZA) to post revenue of $1.76 billion, which represents a fall of 0.9% from $1.78 billion in 2017. The negative SSSG in North America is expected to lower the company’s revenue in 2018. The company’s management expects its SSSG to be in the range of -3.0%–0% in North America.

However, some of the declines are expected to be offset by positive SSSG in international markets and unit growth. Management expects the SSSG in international markets to be in the range of 3.0%–5.0% in 2018. The company is also expecting to increase its unit count by 3.0%–5.0% during the period.

Yum! Brands

Analysts are expecting Yum! Brands (YUM) to post revenue of $4.38 billion in 2018, which represents a fall of 25.6% from $5.88 billion. The company plans to refranchise some of its company-owned restaurants to increase the percentage of franchised restaurants to 98% in 2018 from the current 97%. So the refranchising is expected to lower the company’s revenue in 2018. However, some of the revenue declines are expected to be offset by positive SSSG and the addition of new restaurants. The company’s management expects unit growth of 3.0% to 4.0% in 2018 and has set systemwide SSSG guidance in the range of 2.0%–3.0%.

Next in this series, we’ll look at EBIT margins for pizza companies.

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