Overview
Bernstein SocGen Group has lowered its price target for Domino’s Pizza (DPZ) to $470 from $490 and left its rating at Market Perform. The firm pointed to uncertainty around Domino’s near-term marketing approach and potential demand impacts from GLP-1 drugs as reasons investors may question the sustainability of comparable sales gains.
Quarterly performance and margins
Domino’s reported fourth-quarter U.S. same-store sales growth of 3.7%. Within that figure, carryout sales rose 6.5% while delivery grew 1.6%. International same-store sales expanded by 0.7%, marking the company’s 32nd consecutive year of positive same-store sales growth.
Restaurant-level margins compressed to 10.1% in the quarter. Bernstein attributed the decline to auto insurance claims adjustments rather than increased promotional activity. At the franchisee level, average store EBITDA in fiscal 2025 rose by $4,000 to $166,000.
Analyst concerns and peer context
Bernstein emphasized two primary visibility concerns: the absence of clear marketing plans and the potential for GLP-1 drugs to weigh on quick-service restaurant demand. The analyst firm warned these factors could prompt investors to reassess Domino’s ability to sustain comparable sales growth.
Despite those concerns, Domino’s closed the year with stronger same-store sales growth than any peer operating more than 3,000 stores. The reporting period also saw eight analysts revise earnings estimates downward for the upcoming period, according to available analyst-data.
Valuation snapshot
Bernstein noted Domino’s current valuation at 21 times earnings is one standard deviation below its five-year average. The stock is trading at a price-to-earnings ratio of 23.23. Analyst price targets among contributors range from $340 to $601. Independent valuation analysis indicates the shares are trading near Fair Value, and the company holds a "GOOD" financial health score.
Other analyst moves and market reaction
Domino’s fourth-quarter financials for fiscal 2025 showed revenue of $1.54 billion, above the consensus estimate of $1.52 billion. EBITDA came in at $323 million, narrowly exceeding the anticipated $320 million. U.S. same-store sales grew 3.7% for the quarter, ahead of analyst expectations of 3.47%, driven by value-focused promotions and new menu introductions.
Following the results, several brokerages updated their stances and targets. Benchmark reaffirmed a Buy rating and held a $540 price target. BTIG maintained a Buy rating with a $500 price target, noting a U.S. same-store sales increase of 3.0% that met its expectations and topped analyst forecasts. Evercore ISI raised its price target to $510, citing steady U.S. market share gains. BMO Capital lowered its target to $500 but kept an Outperform rating while highlighting limited visibility on comparable sales for the second half of 2026.
What this means for investors
The firm’s adjustment reflects a cautious stance: confidence in Domino’s recent operational results and franchise profitability is balanced against uncertainty about future marketing execution and broader demand dynamics in quick-service restaurants. The mixed set of analyst adjustments that followed the quarterly release underscores divergent views on Domino’s near-term trajectory despite generally healthy underlying results.
Investors evaluating Domino’s should weigh the company’s demonstrated same-store sales strength and franchise-level EBITDA gains against valuation positioning and the visibility gaps highlighted by analysts.
Note: Certain analyst-data and valuation references in this report are drawn from aggregated market and analyst datasets provided to financial professionals.