Exit of newly appointed CEO postpones recovery of Australia's Domino's Pizza Enterprises, Morningstar says

Dominos Pizza Enterprises

02/07/2025 22:26

** Morningstar cuts fair value estimate for Domino's Pizza Enterprises DMP.AX by 21% to A$46

** The investment research firm believes markets are losing faith in DMP's growth potential as uncertainty on leadership and strategy prevails, leaving shares materially undervalued

** DMP's shares ended about 16% lower on Wednesday after co said CEO and managing director Mark van Dyck would step down before Christmas this year

** Morningstar anticipates prolonged turnaround to delay the global network expansion and expects a lower ultimate store count for DMP

** Morningstar forecasts Domino's to reach 5,400 stores by fiscal 2034, down 7% from its previous estimate of 5,800 stores

** However, Morningstar says significant expansion opportunities remain in Europe and Asia

** Two of 14 analysts rate the stock "buy" or higher, 10 "hold" and two "sell"; their median PT is A$26.50 — LSEG data

** Stock's YTD losses at 42.4%

(Reporting by Sherin Sunny in Bengaluru)

((Sherin.Sunny@thomsonreuters.com))