Brokerages cautious on Australia's Domino's Pizza following Japan CEO change

Dominos Pizza Enterprises

03/06/2025 20:07

** Jefferies says that while Domino's Pizza Enterprises DMP.AX has delivered cost reduction and productivity in Japan, the next more-challenging step is to drive sales growth

** Japan accounts for just over a quarter of company's total worldwide stores

** Pizza chain operator on Tuesday said current Domino's Japan CEO Martin Steenks will transition to Japan COO; Asia CEO Josh Kilimnik to assume interim CEO responsibilities

** Jefferies says lack of a trading update suggests Japan business is tracking broadly consistent with consensus

** Brokerage maintains "buy" rating and PT of A$42

** However, Citi sees risk that Japan business turnaround may be tracking behind expectations

** Citi lowers FY26 like-for-like Japan sales forecast to +0.4% from +2%, estimates NPAT to fall by 2%, 5% and 4% for fiscal years 2025, 2026 and 2027, respectively

** Brokerage reduces its PT by 25% to A$23.82, retains "neutral" tag

** DMP down 26.1% YTD, as of last close

(Reporting by Nikita Maria Jino in Bengaluru)

((Nikita.Jino@thomsonreuters.com;))