Domino's Pizza Share Discussion Threads

[philanderer] 23/6/2017 13:43

PI , is that support where Investec put their target price ? 271p

[panic investor] 23/6/2017 13:40

It hit major support resistance this morning on the daily and weekly

[woodsman2004] 23/6/2017 12:51

Added a few of these for a long-term hold.

Seems to be a pretty normal case of a high growth, high valued stock getting a battering once a few headwinds are encountered and the rapid growth story does not look quite so rapid....

Nevertheless, with my long term hat on, I would say that DOM remains not only growth stock, but also relatively defensive and counter-cyclical i.e. if the consumer is squeezed, some might forgo the meal out and say in and watch X Factor with a pizza etc.

I am also very positive toward the Nordics acquisition - for various reasons these countries have nothing like the number of national pizza and other fast food brands that is the case in the UK - and their culture is changing for the better/worse!

[philanderer] 23/6/2017 12:34

Thanks for the note robin.

Resistance: 280p is the new 290p today.

[robinnicolson] 23/6/2017 12:23

It has been mentioned elsewhere this week in the financial press that there are many expensively rated consumer-facing stocks out there. Just a few examples:

Fevertree: current P/E: c.71
Hotel Chocolat: forecast P/E: 47
Just Eat: forecast P/E: 40

[robinnicolson] 23/6/2017 12:16

That Berenberg note:

For a number of years, Domino's delivered very strong revenue growth in the UK, before momentum slowed at the start of 2017. While we initially thought this would bounce back quickly, we increasingly believe that some issues could create continued pressure on near-term performance. Some of these have the potential to become longer-term problems but we still feel that, as long as they are dealt with, Domino's could successfully build a larger business in the UK over time. However, given the near-term challenges, we downgrade to Hold and reduce our price target to GBp325.

Danger of falling behind the technology curve: Over the past few years, Domino's has taken advantage of the market shift to online ordering as its e-commerce offering has been better than those of its traditional competitors. However, new players are changing the game and Domino's is currently proving slow to react. The most notable example is GPS tracking. Although this is being trialled at present, its rollout will not begin until the second half of the year and no time scale has been determined for it to be introduced across the whole estate. Once implemented, we think it should provide a boost to lfl growth but until then rivals may capture more sales.
The idea of the Domino's GPS Driver Tracker was born out the thinking – “How do we make our driver fleet safer?”
Our drivers are the heart of our organisation and with new technology we now have the ability to keep them and the driver environment much safer. With GPS Driver Tracker Domino's has been able to make sure our drivers are always driving within the speed limit and we can also measure the harshness of driving. As a result of the invention of the Domino's GPS Driver Tracker, we’ve been able to reduce our incidents by 50%.
Domino's GPS Driver Tracker links the online ordering experience with the store delivery driver so customers know exactly when their pizza order is leaving the store and how long it will take to get to their house. In fact, it provides the customer access to watch the route the driver takes to get to their place in real-time.
With the technology active, Domino's stores can now record and measure a lot of data they never before had transparency over. This includes the exact time it took to do the delivery, even down to the second. They can see the route the driver took to get to the destination and compare that with the optimum way to go, which is worked out by distance, time and traffic.

Market uncertainty: One of the reasons given for the low lfl growth at the start of 2017 was a weak consumer environment. At the time, we noted the lack of evidence for this. However, since then a host of consumer facing companies have highlighted the uncertain market conditions and spending data has softened. Given the potential internal issues and the possibility of a more subdued external environment, we reduce our 2017E UK lfl growth forecast to 1.5%.
Valuation: Domino's trades on 19.4x 2017E P/E for 9% 2017-19E EPS CAGR

[tedrux] 23/6/2017 12:15

I topped up yesterday at 289. Should have waited a bit longer!

[dahhad] 23/6/2017 12:00

The next trading update will prove interesting!!

[robinnicolson] 23/6/2017 09:56

Double-checking their spreadsheet models? ;-)

[philanderer] 23/6/2017 09:40

So where`s Numis ;-)

[philanderer] 23/6/2017 09:24

Well we hit Investec`s 271p price target earlier and bounced off that. And Berenberg's new target is 12.5% north.

Yielding almost 3% now.

[robinnicolson] 23/6/2017 09:23

More on that Berenberg downgrade this morning:

Berenberg says revenue growth momentum slowed at the start of 2017, with some drags having the potential to become longer-term problems
Broker says Domino's reaped benefit of the market shift to online ordering but new players are changing the dynamics and co is currently proving slow to react; cites slow roll-out of GPS tracking system across the whole estate
Berenberg adds food price inflation will likely squeeze franchisee margins this year
Broker also cites weak consumer environment as one of the reasons for low LFL growth at the start of 2017; cuts 2017E UK LFL growth forecast to 1.5%

[jamesjamiebarlow] 23/6/2017 09:16

This is the stinker in my portfolio at tge minute. Bought in at 330. Looks like I'm in for a long ride.

[philanderer] 23/6/2017 08:59

Couldn`t resist that .... 5,000 @ 269.7p.

Bad news priced in now.

Morning everyone

[basem1] 23/6/2017 08:25

PE of 20. Still not cheap. Been too well loved for too long this stock, reality is finally catching up.

[ddubzy] 23/6/2017 08:20

Wow, so easy to lose money isn't it!

[philbrown29] 23/6/2017 08:13

Amazing how a fundamentally decent stock can be wiped out in 4 days from one rating. Congratulations investec!

[robinnicolson] 23/6/2017 08:12

Berenberg downgrade. 325p PT

[philbrown29] 23/6/2017 08:10

Very greedy was my answer

[philanderer] 22/6/2017 17:45

Just holding above that 290p.

UT: 585k @ 290.7p

[philbrown29] 22/6/2017 17:43

Nice little reversal today on lower volume which is a glimmer of hope, still a couple of decent size sells after close will all depend on how greedy the remaining short positions are tomorrow going into the weekend.

[philanderer] 22/6/2017 11:23

Let`s see if this 290p resistance can be taken out.

[tedrux] 22/6/2017 10:48

Thank Phil. I'm holding out. Just thinking of getting some more soon.

[philanderer] 22/6/2017 10:38

Ted, I thought it was a good time at 299p :-)

Volume picking up now.

[tedrux] 22/6/2017 10:28

Is it a good time to get more?