uploads///Dominos

Domino’s Stock Rallies on Strong 1Q18 Earnings

By

Nov. 20 2020, Updated 4:41 p.m. ET

1Q18 performance

Domino’s Pizza (DPZ) posted its 1Q18 earnings today with adjusted EPS (earnings per share) of $2.0 on revenues of $785.4 million. The company outperformed both analysts’ revenue expectation of $691.9 million and their EPS expectation of $1.77. Also, the company posted strong domestic SSSG of 8.3%, versus analysts’ expectation of 4.7%. The strong sales and earnings appear to have increased investors’ confidence, leading to a rise of over 8.0% in Domino’s stock price.

Article continues below advertisement

Year-over-year revenue growth

Year-over-year, Domino’s Pizza’s posted revenue growth of 25.8% in 1Q18. The revenue growth was driven by the addition of new restaurants, positive SSSG, and the adoption of a new accounting standard, which recognizes the contributions of $82.2 million from domestic franchisees to Domino’s National Advertising Fund as domestic franchise advertising revenues.

Compared to 1Q17, the company operated 964 more franchised restaurants and two more company-owned restaurants in 1Q18. The company posted SSSG of 6.4% in domestic company-owned restaurants, 8.4% in domestic franchised restaurants, and 5.0% in international restaurants.

EPS growth

Compared to 1Q17, Domino’s EPS grew 58.7% in 1Q18. The EPS growth was driven by revenue growth, the expansion of net margin, and share repurchases. The company’s net margin expanded from 10.0% in 1Q17 to 11.3% due to a lower cost of sales, G&A (general and administrative) expenses, and interest expenses. In last four quarters, from the beginning of 2Q17 to the end of 1Q18, the company repurchased approximately $1.1 billion worth of shares.

You’ll soon find more detailed analysis of the 1Q18 results on our Consumer Staples page.

Advertisement

More From Market Realist

    • CONNECT with Market Realist
    • Link to Facebook
    • Link to Twitter
    • Link to Instagram
    • Link to Email Subscribe
    Market Realist Logo
    Do Not Sell My Personal Information

    © Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.