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

Domino's Pizza, Inc. (DPZ) has been a standout performer in the restaurant industry, and its stock has been a favorite among investors. With a market cap of over $15 billion and a strong financial track record, Domino's Pizza offers several compelling reasons to buy its stock. Here are five reasons to consider adding Domino's Pizza to your portfolio today.

1. Pizza's continued appeal to the modern consumer

Pizza remains one of the most popular foods worldwide, and Domino's Pizza has capitalized on this demand by offering quick, convenient, and customizable options. The company's focus on speed and efficiency, coupled with its wide range of toppings and crust options, has made it a go-to choice for consumers looking for a satisfying meal. As long as people enjoy pizza, Domino's Pizza will continue to thrive.



2. The company's brand and technology advantage in a fragmented market

Domino's Pizza has built a strong brand and invested heavily in technology to maintain a competitive edge in the crowded pizza market. The company's app and website allow customers to order and track their orders in real-time, providing a seamless and convenient experience. This focus on technology has helped Domino's Pizza increase its market share in the United States, growing from 13.5% in 2015 to 22.9% in 2024.



3. Room for store expansion

Domino's Pizza has plans to expand its store count both in the United States and internationally. The company aims to increase its U.S. store count from 6,930 to over 8,500 and its international store count from 14,032 to over 40,000. This expansion strategy will allow Domino's Pizza to tap into new markets and capture a larger share of the pizza delivery market.



4. A growing dividend

Domino's Pizza has a strong dividend track record, with a 12-year history of dividend growth. The company's dividend yield is currently around 1.4%, but its dividend growth rate has been impressive, with an average increase of 18% over the past five years. As Domino's Pizza continues to generate strong cash flow, investors can expect the company to maintain and grow its dividend payouts.



5. The stock is a solid deal right now

Domino's Pizza stock trades at a forward P/E ratio of just under 24, which is relatively low compared to other high-growth consumer discretionary stocks. The company's PEG ratio, which compares its valuation to its anticipated growth, is around 2.2, indicating that the stock is reasonably priced given its expected growth prospects. Warren Buffett's Berkshire Hathaway recently initiated a small position in Domino's Pizza, further validating the stock's attractiveness.



In conclusion, Domino's Pizza offers a compelling combination of growth, dividend income, and a reasonable valuation. The company's focus on speed, convenience, and customization, coupled with its strong brand and technology advantage, positions it well for continued success in the pizza delivery market. As Domino's Pizza continues to expand its store count and generate strong cash flow, investors can expect the company to deliver solid returns for years to come.