3 Reasons to Buy Domino's Pizza Stock Like There's No Tomorrow

Time to search the waiver wire for some mouthwatering investment opportunities. That's stock market talk about trying to pick up some bargains, companies not on everyone's radar that have turned out to be interesting prospects. Let's go hunting for some new additions to your portfolio because of the recent market volatility.

I'm still bullish on some of our previous picks -- Okta (OKTA), ServiceNow (NOW), and Salesforce.com (CRM) -- as they have been beaten down along with the broader market. But let's focus on Domino's Pizza (DPZ), a stock that has been on a rollercoaster ride recently.

First, let's address the elephant in the room: Warren Buffett's Berkshire Hathaway (BRK.A) (BRK.B) sold a significant portion of its Apple (AAPL) stake in the third quarter, cutting its position by 25%. Meanwhile, the company started a small position in Domino's Pizza. This move by the Oracle of Omaha is a clear signal that he sees value in Domino's stock.

Domino's Pizza has been a high-growth, tech-savvy company that has consistently innovated and adapted to changing market conditions. The company's strong brand and large scale have allowed it to maintain pricing power and cost advantages, as discussed in the Q&A material. Domino's has also been a significant repurchaser of its own shares, reducing its share count by roughly 38% over the past decade. This capital-light growth strategy has enabled the company to create shareholder value through share repurchases.

Second, Domino's Pizza's digital transformation strategy has significantly contributed to its growth potential. The company has integrated advanced logistics and delivery systems into its business model, aligning it with TaaS (Transportation as a Service) principles. This integration has allowed Domino's to play a significant role in transporting food, contributing to its growth and market position. Additionally, Domino's leverages customer data to provide tailored offers and promotions, which helps increase order frequency and average ticket size. The company's partnership with DoorDash has also supported its growth and operations by providing access to a vast network of customers.

Third, Domino's Pizza's international expansion strategy has significantly impacted its long-term growth prospects. The company has been expanding its presence in under-penetrated markets, such as Ireland and Poland, through acquisitions and minority stakes. This strategy allows Domino's to tap into new customer bases and increase its global reach. Domino's international expansion strategy has been validated by its strong financial performance, with earnings increasing by 14.78% to $519.12 million in 2023, despite a slight decrease in revenue.

In conclusion, Domino's Pizza stock is a compelling investment opportunity due to its strong brand, large scale, and innovative digital transformation strategy. The company's international expansion strategy has also contributed to its long-term growth prospects. With Warren Buffett's Berkshire Hathaway taking a stake in the company, it's clear that there's value to be found in Domino's Pizza stock. So, go ahead and add this mouthwatering investment to your portfolio before it's too late.