The 10-second takeaway
For the quarter ended June 17 (Q2), Domino's Pizza missed estimates on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share expanded significantly.
Margins improved across the board.
Domino's Pizza reported revenue of $376.1 million. The 10 analysts polled by S&P Capital IQ predicted revenue of $388.0 million on the same basis. GAAP reported sales were 2.3% lower than the prior-year quarter's $384.9 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.47. The 13 earnings estimates compiled by S&P Capital IQ anticipated $0.47 per share. GAAP EPS of $0.47 for Q2 were 18% higher than the prior-year quarter's $0.40 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 30.5%, 170 basis points better than the prior-year quarter. Operating margin was 17.5%, 140 basis points better than the prior-year quarter. Net margin was 7.5%, 90 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $374.5 million. On the bottom line, the average EPS estimate is $0.41.
Next year's average estimate for revenue is $1.65 billion. The average EPS estimate is $1.93.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 336 members out of 416 rating the stock outperform, and 80 members rating it underperform. Among 115 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 92 give Domino's Pizza a green thumbs-up, and 23 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Domino's Pizza is outperform, with an average price target of $38.64.
Over the decades, small-cap stocks, like Domino's Pizza have provided market-beating returns, provided they're value priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
- Add Domino's Pizza to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.