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Papa John's Demand Spike Extends Into August

By Demitri Kalogeropoulos - Updated Aug 25, 2020 at 10:18AM

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Consumers aren't moving away from its pizza offerings even as economies reopen around the world.

Papa John's International's (PZZA 3.12%) business is still enjoying a strong sales lift from pandemic-related consumer shopping changes. The pizza delivery specialist said on Tuesday that comparable-stores sales were up 24% from late July through Aug. 23. That result marked only a slight deceleration in its U.S. market compared to the prior month while the international segment sped up.

Management described the global surge as an outgrowth of the chain's popular new menu introductions, along with its latest improvements to the ordering and delivery services.

As opposed to simply a pandemic-fueled jump, that factor implies persistent gains even as the COVID-19 threat lessens over the coming quarters. "As we have added customers throughout 2020," CEO Rob Lynch said in a press release, "our customer satisfaction and brand affinity scores also continue rising."

A delivered pizza.

Image source: Getty Images.

Papa John's will need to rely on that improving shopper affinity as it faces intensifying competition from fast-food and casual-dining restaurants and from delivery focused peers like Domino's Pizza. All these rivals are fighting to establish and maintain market share in the context of quickly shifting consumer trends. At least through late August, Papa John's seems to be holding its own in that challenging selling environment.

Demitri Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool recommends Domino's Pizza. The Motley Fool has a disclosure policy.

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