Domino’s Pizza(DPZ) The Motley Fool·2024-12-03 14:53Core Insights - Domino's Pizza has transformed a 1 million today, showcasing its significant stock performance and growth strategy [2][12] - The company has successfully expanded its store count and aims to continue this growth trajectory, targeting 7,700 stores in the U.S. by 2028 and over 40,000 globally in the long term [8][12] Company Strategy - Domino's revamped its pizza recipe in 2008 and 2009, which was a pivotal moment that contributed to its success, alongside a strong value proposition for consumers [3][4] - The franchise model allows Domino's to maintain low overhead costs while leveraging technology for efficiency, making it competitive against local pizzerias [5][6] Market Position - The global pizza industry is valued at approximately $160 billion, with Domino's holding a strong position amidst fierce competition [2] - The company currently operates around 21,000 stores worldwide, with 6,906 in the U.S., and has opened 805 net new stores in the past year [7] Financial Performance - Domino's has consistently raised its dividend for 12 years and has reduced its share count by nearly 38% through stock buybacks, indicating strong cash flow management [9][10] - The company operates with a debt-to-EBITDA ratio between 4 and 6, which is higher than some peers, but has attracted investment interest from notable investors like Warren Buffett [10][11] Future Outlook - Analysts project an average annual earnings growth of 11%, leading to an estimated total return of approximately 12% annually, combining earnings growth and dividend yield [13] - While the current price/earnings-to-growth (PEG) ratio is 2.5, it is considered fairly priced with potential for market-beating performance in the coming decade [14]