Proactive Investors - Domino's Pizza Inc (NYSE:DPZ) has earned a price target raise from analysts at UBS who believe the pizza chain has “plenty of dough to make still.”
The analysts upped their price target on the stock from $526 to $570 and awarded it a ‘Buy’ rating, reflecting their increased confidence in continued US traffic and sales momentum.
Shares of Domino’s traded at $485 on Tuesday afternoon.
The UBS analysts see accelerating growth and a solid catalyst path driving further upside for the pizza maker’s stock.
“We believe Domino’s is well positioned for sustained multiyear US sales momentum with support from a solid value proposition, digital/loyalty enhancement, improved service levels, menu innovation, marketing, and third-party aggregator partnerships,” they wrote.
They added that results from their recent survey regarding Domino’s brand perception, visit intent and opportunities to maintain traffic and sales momentum suggested that consumers maintain a strong affinity to the brand and multiple attributes continue to resonate.
The survey indicated positive Domino’s visit intent over the next 12 months, with 10% of respondents suggesting they will visit more.
It outperformed pizza peers on multiple important value-related attributes including “good value,” “good promos,” and “good selection of low-priced menu choices.”
Driving customer visits are “good value,” “more promos lately,” and “new menu items,” the survey also revealed.
“Survey results suggest Domino's is positioned to maintain momentum given solid value scores, promos that are resonating, impactful innovation and improved loyalty contribution,” the bank’s analysts wrote.
They concluded: “Domino’s remains a top pick and we believe further upside exists for one of the few restaurants with accelerating same-store sales and unit growth, positive traffic, a compelling catalyst path with potential 2025 earnings beats, and opportunity for further multiple expansion.”