Domino's Pizza Share Discussion Threads

[jak1] 20/6/2017 13:56

Simple eh. Supermarket wars Pizza wars. Nobody wins and shareprices drop all round.
Margins Margins Margins...

[philanderer] 20/6/2017 13:35

Forget 300p..... looks like resistance is 296p now.

edit:

getting sold hard now.

[philanderer] 20/6/2017 12:18

Good call robin.

Numis are house broker and won't be impressed with today's news. They've more than likely got their clients into the stock before they came out with their '510p'.

Next update not due until 25th july with the half-year numbers.

[robinnicolson] 20/6/2017 12:12

Wondering whether we will see this in the next day or two:

A Numis reiteration.
Domino's buying back shares.

[robinnicolson] 20/6/2017 11:28

More on that Investec 'sell':

We believe Domino's Pizza faces a number of challenges with rising competition, increased price discounting, new store cannibalisation and a weak consumer environment likely to continue for some time. In this context, we believe consensus estimates are overly optimistic on LFL sales growth of c.4% for FY17-19; our earnings estimates are c.4-8% below for the period. We initiate with a Sell recommendation and set our DCF-based target price at 271p.

Pizza Hut (PH) has been discounting aggressively – we estimate it has an average bundle deal discount of c.41% compared to Domino's Pizza (DP) at c.34%. Domino's has responded by introducing two new national bundle deals, with an average discount of c.50%, suggesting a sustained period of lower gross margins.

Domino's is targeting 1,600 stores in the UK (currently 950) with two thirds of the new stores set to be area splits. This has resulted in existing store cannibalisation, causing an LFL volume headwind accelerating to 2.4% in Q1 FY17.

The consumer backdrop is changing, while Domino's core customer base of 18-34 year olds are becoming increasingly value driven, which could limit any future upside to gross margins. Furthermore, increasing health consciousness could put further pressure on volumes – the most popular Domino's pizza is the Pepperoni Passion at 1813 calories, 91% of a woman's recommended daily calorie intake and 73% of a man's in the UK.

[philbrown29] 20/6/2017 10:32

Million dollar question is where is support ;)

[philanderer] 20/6/2017 10:30

:-)

Looks like 300p is the new resistance.

[philbrown29] 20/6/2017 10:21

It goes further because the overall sentiment for the stock is long and therefore any significant movement short starts triggering a shed load of stops on the way down effectively creating more sells and increasing the momentum of the fall ironically a bit like a stack of dominos ha ha :)

[philanderer] 20/6/2017 10:16

ddubzy , always seems to me a 'sell' rating nearly always comes with a concerted shorting attack in the market as if to prove a point ;-)

[ddubzy] 20/6/2017 10:03

Always seems that the sell rating has a bigger impact than any buy, or is that just me?!

[philanderer] 20/6/2017 09:59

Happy to sit on a few more at 299.4p ;-)

Getting on for a 3% yield on an unchanged dividend here.

[philbrown29] 20/6/2017 09:46

Yeah true, still feels dramatic for 1 out of sync rating but think your right looks like strong pre-planned momentum getting behind a weak story.

[philanderer] 20/6/2017 09:40

phil, I can't see the Barclays link , they're lead bank to hundreds of plc's.

More likely to be organised shorts getting wind of Investecs note in advance. They've got to close sometime if they're in for a quick buck.


Amazing you can have two brokers in a couple of weeks wtf ;-)

20th june Investec sell tp 271p
9th june Numis buy tp 510p

[philbrown29] 20/6/2017 09:26

Just to add another angle, Barclays are the main company bank for DOM...

"The Serious Fraud Office has charged Barclays and four individuals, including the bank's ex-chief executive John Varley, with conspiracy to commit fraud and for providing unlawful financial assistance during the financial crisis."

Could be a perfect storm here, investec initiates sell, barclays fraud story, mansion house speech and sterling uncertainty all on top of a volatile time for DOM with recent consumer spending drop.

[philanderer] 20/6/2017 09:13

Morning robin , many thanks.

[robinnicolson] 20/6/2017 09:07

Dan Coatsworth of Shares Magazine tweeted:

'Not everyone likes cold pizza'. Investec initiates on Domino's Pizza with a 'sell'.

Competition, price discounting, weak consumer b/drop

[philanderer] 20/6/2017 09:06

Here`s the brokers I have:

9th june Numis buy tp 510p
25th april Berenberg buy tp 400p
21st april Peel Hunt buy tp 400p
19th april Credit Suisse outperform tp 455p
6th april Beaufort speculative buy tp 350p
24th march Barclays equal weight tp 350p
13th march Citigroup neutral tp 350p
10th march Canaccord buy tp 400p
9th march Cenkos sell -
9th march N+1 Singer hold tp 390p



9th march ++++++ Results +++++

[philbrown29] 20/6/2017 09:02

Yeah, it seems far too big a fall to just be one out of context broker rating.

[philanderer] 20/6/2017 09:01

Whatever it is , plenty knew about this fall coming today and dumped yesterday.

[philbrown29] 20/6/2017 08:57

Can't find any info on Investec sell and that TP seems ridiculous

[philanderer] 20/6/2017 08:52

Clanger have you got a link for that Investec news. I can`t believe they had DOM at 118.33p ! I didn`t even know they covered DOM... TIA