Hedgeye CEO Keith McCullough is adding Domino's Pizza (DPZ) to the short side of Investing Ideas. Below is a brief note.
There's nothing quite like it when our guru of the restaurants space goes from bullish to bearish on a name...
Consumables analysts Howard Penney's pivot to bearish on Domino's Pizza (DPZ) was professional:
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DPZ Moving to the SHORT bias list. Like many COVID winners, 2021 is going to be a challenging year for several reasons. Delivery concepts like DPZ were the only go-to place to eat in the early days of the pandemic. The 2020 pull-forward of demand will reverse course in 2021. Current estimates are for 4Q21 SSS of 12.3%, slowing to 9.3% in 1Q21, and the company will experience an MSD decline in SSS for the balance of 2021. We can see the stock trading due to low 20's NTM P/E over the balance of 2021, a similar valuation to 2019 when the company was under pressure from the significant growth in 3PD companies. |
Sell it again as it makes lower highs,
KM