Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of pizza delivery specialist Domino's Pizza
So what: Domino's impressive fourth quarter -- earnings surged 28% -- suggests that its operating momentum isn't about to slow anytime soon. Sales in the U.S. have jumped nicely since the company changed its pizza recipe in late 2009, and management now seems to be channeling that success overseas.
Now what: Looking ahead, management now sees long-term international same-store sales growth of 3% to 6% and 1% to 3% in the U.S. "Our positive results this year provide yet more evidence that we have successfully reset the bar for Domino's Pizza," said CEO J. Patrick Doyle. "The global momentum that we are driving through our innovation, commitment to food quality and outstanding service continues to energize our franchise owners and team members and inspire their terrific performance." However, with shares now up a whopping 120% and trading at a 20-plus P/E, I'd wait for the stock to cool off considerably before digging in.
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