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Factors Setting the Tone for Domino's (DPZ) Q3 Earnings
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Domino's Pizza, Inc. (DPZ - Free Report) is scheduled to report third-quarter fiscal 2022 results on Oct 13, 2022, before the opening bell. In the last reported quarter, the company reported a negative earnings surprise of 2.1%.
How are Estimates Placed?
The Zacks Consensus Estimate for the fiscal third-quarter earnings per share is pegged at $2.96, indicating a decline of 8.6% from $3.24 reported in the year-ago quarter.
For revenues, the consensus mark is pegged at $1,069 million, suggesting growth of 7.1% from the prior-year quarter’s figure.
Let's take a look at how things have shaped up in the quarter.
Factors to Note
Domino's fiscal third-quarter performance is likely to have benefitted from unit expansion efforts, solid digital ordering system and higher global retail sales. This and the emphasis on consumer pricing architecture, improving staffing levels and technological investments (next-generation point of sale system) are likely to have aided the company’s performance in the to-be-reported quarter.
Emphasis on carryout and delivery businesses is likely to have aided the company’s performance in the fiscal third quarter. During the previous quarter, the company initiated innovative ways to engage consumers through its carryout tips promotions and the Mind ordering app launch. It also evolved its national offers to include a $5.99 mix-and-match for carryout customers and $6.99 for delivery mix-and-match. During the second quarter of fiscal 2022, the company stated that carryout and delivery same-store sales remained above 2019 levels. Given the solid demand coupled with the promotional initiatives, the momentum is likely to have persisted in the to-be-reported quarter.
Robust supply chain revenues and U.S. franchise advertising revenues may have favored the company’s top line in the fiscal third quarter. The Zacks Consensus Estimate for domestic revenues from franchise advertising and supply chain is pegged at $113 million and $634 million, suggesting year-over-year growth of 3.7% and 7.6%, respectively. The consensus mark for revenues from U.S. company-owned stores stands at $116 million, suggesting a decline of 7.4% year over year.
Elevated commodities inflation are likely to have hurt margins in the fiscal third quarter. This and headwinds related to development (owing to supply chain problems), labor constraints and staffing challenges are expected to have affected the company’s performance in the to-be-reported quarter.
What the Zacks Model Unveils
Our proven model does not predict an earnings beat for Domino's this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that's not the case here.
Earnings ESP: Domino's has an Earnings ESP of -0.30%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are some stocks from the Zacks Retail-Wholesale sector that investors may consider, as our model shows that these have the right combination of elements to post an earnings beat in the quarter to be reported:
The Kroger Co. (KR - Free Report) currently has an Earnings ESP of +0.75% and a Zacks Rank #2.
Shares of Kroger have increased 8.6% in the past year. KR’s earnings beat the consensus mark in each of the last four quarters. The company has a trailing four-quarter earnings surprise of 15.7%, on average.
Chipotle Mexican Grill, Inc. (CMG - Free Report) has an Earnings ESP of +2.20% and a Zacks Rank #2.
Shares of Chipotle have declined 17.1% in the past year. CMG’s earnings beat the consensus mark in each of the last four quarters. The company has a trailing four-quarter earnings surprise of 6.2%, on average.
Restaurant Brands International Inc. (QSR - Free Report) currently has an Earnings ESP of +0.78% and a Zacks Rank #3.
Shares of Restaurant Brands have declined 15.1% in the past year. QSR’s earnings beat the consensus mark in each of the last four quarters. The company has a trailing four-quarter earnings surprise of 6.1% on average.
Image: Bigstock
Factors Setting the Tone for Domino's (DPZ) Q3 Earnings
Domino's Pizza, Inc. (DPZ - Free Report) is scheduled to report third-quarter fiscal 2022 results on Oct 13, 2022, before the opening bell. In the last reported quarter, the company reported a negative earnings surprise of 2.1%.
How are Estimates Placed?
The Zacks Consensus Estimate for the fiscal third-quarter earnings per share is pegged at $2.96, indicating a decline of 8.6% from $3.24 reported in the year-ago quarter.
For revenues, the consensus mark is pegged at $1,069 million, suggesting growth of 7.1% from the prior-year quarter’s figure.
Let's take a look at how things have shaped up in the quarter.
Factors to Note
Domino's fiscal third-quarter performance is likely to have benefitted from unit expansion efforts, solid digital ordering system and higher global retail sales. This and the emphasis on consumer pricing architecture, improving staffing levels and technological investments (next-generation point of sale system) are likely to have aided the company’s performance in the to-be-reported quarter.
Emphasis on carryout and delivery businesses is likely to have aided the company’s performance in the fiscal third quarter. During the previous quarter, the company initiated innovative ways to engage consumers through its carryout tips promotions and the Mind ordering app launch. It also evolved its national offers to include a $5.99 mix-and-match for carryout customers and $6.99 for delivery mix-and-match. During the second quarter of fiscal 2022, the company stated that carryout and delivery same-store sales remained above 2019 levels. Given the solid demand coupled with the promotional initiatives, the momentum is likely to have persisted in the to-be-reported quarter.
Robust supply chain revenues and U.S. franchise advertising revenues may have favored the company’s top line in the fiscal third quarter. The Zacks Consensus Estimate for domestic revenues from franchise advertising and supply chain is pegged at $113 million and $634 million, suggesting year-over-year growth of 3.7% and 7.6%, respectively. The consensus mark for revenues from U.S. company-owned stores stands at $116 million, suggesting a decline of 7.4% year over year.
Elevated commodities inflation are likely to have hurt margins in the fiscal third quarter. This and headwinds related to development (owing to supply chain problems), labor constraints and staffing challenges are expected to have affected the company’s performance in the to-be-reported quarter.
What the Zacks Model Unveils
Our proven model does not predict an earnings beat for Domino's this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that's not the case here.
Earnings ESP: Domino's has an Earnings ESP of -0.30%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Domino's carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks Poised to Beat Earnings Estimates
Here are some stocks from the Zacks Retail-Wholesale sector that investors may consider, as our model shows that these have the right combination of elements to post an earnings beat in the quarter to be reported:
The Kroger Co. (KR - Free Report) currently has an Earnings ESP of +0.75% and a Zacks Rank #2.
Shares of Kroger have increased 8.6% in the past year. KR’s earnings beat the consensus mark in each of the last four quarters. The company has a trailing four-quarter earnings surprise of 15.7%, on average.
Chipotle Mexican Grill, Inc. (CMG - Free Report) has an Earnings ESP of +2.20% and a Zacks Rank #2.
Shares of Chipotle have declined 17.1% in the past year. CMG’s earnings beat the consensus mark in each of the last four quarters. The company has a trailing four-quarter earnings surprise of 6.2%, on average.
Restaurant Brands International Inc. (QSR - Free Report) currently has an Earnings ESP of +0.78% and a Zacks Rank #3.
Shares of Restaurant Brands have declined 15.1% in the past year. QSR’s earnings beat the consensus mark in each of the last four quarters. The company has a trailing four-quarter earnings surprise of 6.1% on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.