Domino's Pizza, Inc.
Domino's Pizza, Inc. Fundamental Analysis
Domino's Pizza, Inc. (DPZ) shows moderate financial fundamentals with a PE ratio of 22.14, profit margin of 12.16%, and ROE of -14.91%. The company generates $4.8B in annual revenue with moderate year-over-year growth of 5.07%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 55.2/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze DPZ's fundamental strength across five key dimensions:
Efficiency Score
ExcellentDPZ demonstrates superior asset utilization.
Valuation Score
ExcellentDPZ trades at attractive valuation levels.
Growth Score
ExcellentDPZ delivers strong and consistent growth momentum.
Financial Health Score
ExcellentDPZ maintains a strong and stable balance sheet.
Profitability Score
WeakDPZ struggles to sustain strong margins.
Key Financial Metrics
Is DPZ Expensive or Cheap?
P/E Ratio
DPZ trades at 22.14 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, DPZ's PEG of -34.88 indicates potential undervaluation.
Price to Book
The market values Domino's Pizza, Inc. at -3.29 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 7.89 times EBITDA. This is generally considered low.
How Well Does DPZ Make Money?
Net Profit Margin
For every $100 in sales, Domino's Pizza, Inc. keeps $12.16 as profit after all expenses.
Operating Margin
Core operations generate 19.22 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $-14.91 in profit for every $100 of shareholder equity.
ROA
Domino's Pizza, Inc. generates $35.51 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Domino's Pizza, Inc. produces operating cash flow of $727.40M, showing steady but balanced cash generation.
Free Cash Flow
Domino's Pizza, Inc. generates strong free cash flow of $629.04M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $18.62 in free cash annually.
FCF Yield
DPZ converts 4.86% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
22.14
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-34.88
vs 25 benchmark
P/B Ratio
Price to book value ratio
-3.29
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.68
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
-1.29
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.61
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
-0.15
vs 25 benchmark
ROA
Return on assets percentage
0.36
vs 25 benchmark
ROCE
Return on capital employed
0.83
vs 25 benchmark
How DPZ Stacks Against Its Sector Peers
| Metric | DPZ Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 22.14 | 25.25 | Better (Cheaper) |
| ROE | -14.91% | 1170.00% | Weak |
| Net Margin | 12.16% | 742.00% | Weak |
| Debt/Equity | -1.29 | 0.77 | Strong (Low Leverage) |
| Current Ratio | 1.61 | 9.19 | Neutral |
| ROA | 35.51% | -6467.00% (disorted) | Strong |
DPZ outperforms its industry in 3 out of 6 key metrics, particularly excelling in ROA, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Domino's Pizza, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
52.67%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
71.13%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
47.61%
Industry Style: Cyclical, Growth, Discretionary
High Growth