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Section 1: Company Overview and Fundamentals
1.1 Company Overview:
Domino's Pizza Enterprises Limited (ASX: DMP) is the largest pizza chain in Australia with respect to network store numbers and network sales and is the world’s largest franchisee for the Domino's Pizza brand. The company has the exclusive master franchise rights for the Domino's brand and network across various countries that include Australia, New Zealand, Belgium, France, The Netherlands, Japan, Germany, Luxembourg, Denmark, and Taiwan. The US-listed Domino's Pizza, Inc owned the Domino's brand.
1.2 The Key Positives, Negatives, Investment Highlights and Risks
1.3 Top 10 Shareholders: The top 10 shareholders have been highlighted in the chart below, which together forms ~69.01% of the total shareholding.
1.4 Key Metrics:
The company continues to witness improvement in asset turnover to reach 0.50x in 1HFY22 from 0.45x in 1HFY21. Notably, the company’s cash conversion cycle also improved to 34.4 days in 1HFY22 from 39.7 days in 1HFY21.
Section 2: Business Updates and Financial Highlights
2.1 Recent Updates:
2.2 Insights of 1HFY22:
Section 3: Key Risks and Outlook:
Section 4: Stock Recommendation Summary:
4.1 Price Performance and Technical Summary:
4.2 Fundamental Valuation
Valuation Methodology: EV/Sales Multiple Based Relative Valuation (Illustrative)
Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.
Note 1: The reference data in this report has been partly sourced from REFINITIV.
Note 2: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.
Technical Indicators Defined: -
Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.
Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.
Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.
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