Tuesday July 16, 2019, 00:00:00
By Mark Kalinowski
Earlier today, Domino’s (DPZ; Buy) reported second-quarter EPS of $2.19, ahead of our $2.04 forecast and sell-side consensus (according to Consensus Metrix) of $2.02. However, a lower-than-projected tax rate of 12.9% (versus our 20.5% projection and consensus of 19.8%) helped EPS by about $0.20 relative to our forecast. On the other hand, EPS was hampered by about $0.04 related to a loss on the sale of 59 New York City area stores. Taking the tax-rate and refranchising loss issues out, Q2 EPS would have been one cent below our forecast and one cent above sell-side consensus.
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Monday July 8, 2019, 00:00:00
By Mark Kalinowski
With third-party delivery aggregators continuing to grow, providing additional convenience to the consumer, we decided to look at various quarterly data provided by Grubhub (GRUB; Not Rated), correlating these data sets with various sectors’ same-store sales (for U.S. chain restaurants). To do this, we used six different Kalinowski Restaurant Industry Index sector indices, which are sorted by brand type and based on the weighted-average components from 48 different publiclytraded restaurant concepts. (The weightings are based on each concept’s 2018 U.S. systemwide sales, as measured by Technomic.)
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Tuesday June 18, 2019, 00:00:00
By Mark Kalinowski
In our Domino’s (DPZ; Buy) report published yesterday (“DPZ: 2019 Franchise Disclosure Document Review for Domino’s”), we noted that “The Royalty Fee for a Domino’s U.S. franchisee is 5.5% of sales, and the Advertising Fund contribution for a Domino’s U.S. franchisee is 4% of sales.” We want to clarify that at present, Domino’s U.S. franchisees are funding the Domino’s National Advertising Fund (DNAF) at a rate of 6% of sales, as the other 2% that would typically go to the advertising cooperative under section 13.2 of Domino’s standard franchise agreement is instead being rolled up into DNAF (resulting in the 6% being paid to DNAF). So it’s a rate of 6% of sales for all franchisees, with the exception of incentives.
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