Domino’s Pizza, Inc. (NYSE: DPZ) stock falls on disappointing results

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Domino’s Pizza, Inc. (NYSE: DPZ) stock lost over 4.5% this morning on lower than expected third quarter of FY 17 performance. DPZ in the third quarter has reported 19.3 percent growth in the net income due to an increase in same-store sales growth and store count as well as higher supply chain volumes. The adoption of the new equity-based compensation accounting standard has also positively affected the net income. These increases were partially offset by higher general and administrative expenses, primarily from investments in technological initiatives. However, the net income was negatively impacted by expenses related to the company’s recapitalization.

DPZ has posted 8.4% growth in the domestic same-store sales during the third quarter compared to the year-ago period. The international same-store sales grew 5.1% during the quarter. The company had global net store growth of 217 stores in the third quarter, which comprised of 53 net new domestic stores and 164 net new stores internationally, and has added 1,182 net new stores over the trailing four quarters.

The company had reported the adjusted revenue growth of 13.6 percent to $643.6 million in the third quarter of FY 17, beating the analysts’ estimates for revenue of $630.8 billion. The revenue grew primarily due to higher supply chain revenues from increased volumes. The higher same-store sales and store count growth in both the domestic and international markets have also contributed to the increase in revenues.

Additionally, DPZ had declared a 46 cent per share quarterly dividend for shareholders of record as of September 15th, 2017 that was paid on September 29th, 2017. The company has also declared a 46 cent per share quarterly dividend for shareholders of record as of December 15th, 2017, to be paid on December 29th, 2017. In addition, DPZ has authorized a new share repurchase program that allows the company to repurchase up to $1.25 billion of its common stock. As of October 12th, 2017, the company had authorization for repurchases of $250.0 million remaining under its open market share repurchase program.

DPZ stock has risen 31.2% in this year to date (source: Google Finance).

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