Premium Essay

Domino’s Pizza Enterprises Limited (Dmp)

In: Business and Management

Submitted By Emma1119
Words 8454
Pages 34
Domino’s Pizza Enterprises Limited (DMP)
Student Research: This report is published for educational purposes only by students competing in the La Trobe Investment Research Challenge. 19th June 2012

Fast Food Industry 19 June 2012 La Trobe Investment Research Challenge

Ticker: DMP Price: $9.7 EPS FY (c) 0.31 0.33 0.38 0.44 0.46 DPS (c) 0.22 0.23 0.27 0.31 0.32 Franking (%) 100 100 100 100 100

Recommendation: HOLD Target Price: $10.67 P/E (x) 29.81 29.14 25.29 22.26 21.22 Dividend Yield (%) 2.38 2.40 2.52 2.72 2.74

2011A 2012E 2013E 2014E 2015E

Investment Summary
We initiate coverage of Domino’s Pizza Enterprises Limited (DMP) with a hold recommendation and a target price of $10.67 using Discounted Cash Flow Valuation (DCF), offering a 10% upside from current stock price at $9.70 on 19th June, 2012. As DMP operates in regions with different levels of risks, growth and margins, our estimation of revenue is based on top down approach considering the market share in these regions. We believe DMP may offer a long term upside if it can successfully execute its business plan of opening new stores and maintaining its same store sales growth in Australia and New Zealand (ANZ) and France, Netherlands, and Belgium (Europe).

Highlights
Future growth driven by increasing store count: DMP currently owns over 900 stores, with the goal of opening 50-60 new stores per year over the next 5 years. Its franchise/corporate strategy allows a long-term target of 750 stores in ANZ over the next 5 years and 1250 stores in Europe over the next 15 years. Facing challenges in the highly competitive fast food industry in ANZ region and the Euro crisis zone, we expect the compounded annual revenue growth to be about 6% from FY11 to FY15.

Technology changing the way DMP does business: DMP has revolutionized the pizza delivery industry with 50% of business…...

Similar Documents

Premium Essay

Eco 550 Assignment 1 Domino's Pizza

...will be discussing the t that Domino’s is considering entering the marketplace in my community of Waynesboro, GA. I have conducted research to gather information in regards to demand for this business based on population, average income per household and average cost of pizza in this particular area. The end results of this research and demand analysis we should be able to determine if this would be a wise investment move to make on Domino’s behalf. Waynesboro is a fairly small town located in Burke County, GA. The current population for this town is about 5,781(www.city-data.com). The median income per household in my city from 2001 to 2011 has ranged from an estimate of about $27,166 to about $31,188 for the current day. The average cost of pizza from other pizza places over the years (2001-2011) ranged anywhere from $5.00 to about $18.00 depending on what you want and how you want it prepared. As far as household sizes they would range from about 1 person to about 5 people on average and the number of pizzas were hypothetically ordered were based on the number of people per household and how much income they were making. The more kids that are in a household the better the chances are of ordering pizza since it is no secret that kids love pizza. Another factor to consider would be single individuals who work long hours and prefer ordering put as opposed to cooking after a long day’s work. All these factors combined will help us determine if Domino’s should start a......

Words: 1241 - Pages: 5

Premium Essay

Domino's Sizzle with Pizza Tracker

...Domino’s Sizzles with Pizza Tracker Management Information Systems 625 Jacob M. Shannon Walsh University Case Study #1 There has been a definite transition in the pizza delivery business, with massive pizza chains vying for the most innovate way to create and sell their product. Even though this case may be a few years dated, one can still observe these innovations occurring in the present. Through intricate and efficient information systems, these innovations can be a viable and a creative way to get the customers what they want; however, in a different more unique fashion that can appeal to a wide and young demographic. Where one business lacks in quality compared to the other chains, the business can make up for it with innovative strategies for the customer to create the product they want. This in a sense almost gives the company, like Domino’s, a competitive edge when their quality doesn’t match competitors’. Utilization of systems like Pulse, a proprietary point-of-sale system, is an important asset in maintaining consistent and efficient management functions in each of its franchises (Laudon & Laudon, 2012). There are various types of information systems utilized within Domino’s strategy to gain a valid entry in the pizza chain market. One of these systems implemented is the transaction processing system or (TPS), which is utilized within their Pulse network. The transaction processing system serves to perform and record the daily routine transactions......

Words: 882 - Pages: 4

Premium Essay

Domino’s Pizza: Health Code Standards Crisis

...Domino’s pizza: Health code standards crisis 1) Short background about the company: Domino's Pizza is an American restaurant chain and international franchise pizza delivery corporation headquartered at the Domino Farms Office Park campus in Ann Arbor Township, Michigan United States, near Ann Arbor, Michigan. Founded in 1960, Domino's is the second-largest pizza chain in the United States (after Pizza Hut) and the largest worldwide, with more than 10,000 corporate and franchised stores in 70 countries. Domino's Pizza was sold to Bain Capital in 1998 and went public in 2004. Domino’s Pizza offers customers a full menu to choose from, including four types of pizza crust (thin, hand-tossed, deep dish and Italian Style), Domino’s Specialty Pizzas and delicious side items Cheesy Bread, Bread sticks, Chicken Wings, Chicken kickers, Crunchy Chocolate Calzone, CinnaStix, Chocolate Souffle and Pepsi products. | 2) The problem faced: Two employees posted YouTube videos of themselves engaging in a number of public health law violations: putting cheese in the nose, blowing mucous on a sandwich and putting a sponge, used to wash dishes, between the buttocks. The woman holding the camera was saying: "In about five minutes, they'll be sent out to delivery, where somebody will be eating these, yes, eating them. And little did they know that cheese was in his nose and that there was some lethal gas that ended up on their salami,” "That's how we roll at Domino's." The videos went......

Words: 1361 - Pages: 6

Premium Essay

Owning a Slice of Th Action a Domino's Pizza Frenchise

...DOMINO’ S PIZZA FRANCHISE 1. According to the article, Domino’s Pizza is a second largest pizza franchise, and it is called a “franchisor,” or business owner. Domino’s sells others the right to use its name and sell its products in specific geographic area. As usual, an entrepreneur, a person who risks time and money to start and manage a business, may be interested in opening his/her own business by purchasing a franchise, and is called a franchisee. However, there are many benefits of owning a Domino’s franchise. First, Domino’s is a strong global brand, and with the Domino’s reputation, new business is easier to start because the consumers are familiar with the products. Second, along with reputation of Domino’s, franchisees benefits from the national advertising programs. The franchisees are also assisted to be given the access to suppliers with the products and price, this makes the Domino’s franchise more profitable. In addition, Domino’s franchisees are not required to have experience because they will be trained and guaranteed in succeeding; therefore, owning a Domino’s franchise has a higher rate to succeed than start up a normal pizza business. In contrast, the franchisees will have great opportunities to reach to the high revenue, and Domino’s, at the same time, will earn great royalties (the fees paid to franchisor) from their franchisees. In the whole, both Domino’s and its franchisees benefit; the success of franchisees with great profit also brings the......

Words: 881 - Pages: 4

Premium Essay

Domino's Pizza Sizzles with Pizza Trackeer

...DOMINO’S SIZZLES WITH PIZZA TRACKER 1 Domino’s Sizzle with Pizza Tracker January 17, 2015 Abstract The purpose of this case study is to exam how Domino’s pizza uses Information Systems to regain their share of the Home Delivery pizza market. I’ll discuss how Domino’s overcome a bad reputation and improved their product and services. I will also discuss the changes and process systems implemented along with where they currently stand in the market and with their customers. I will finish with the technology Domino’s plans to use in the future.  DOMINO’S PIZZA SIZZLES WITH PIZZA TRACKER 2 Domino’s Pizza Sizzles with Pizza Tracker This case study discusses the impact that information systems and global e-business has had on Domino’s Pizzas’ reemergence as an industry leader in the home-delivery pizza market. It looks into what kind of systems are used, how the systems improve business performance, how their online pizza ordering system has improved the ordering process and how the systems are giving Domino’s a competitive edge. Domino’s opened in 1960 and grew to 200 stores in 1978 and currently operates almost 9000 stores worldwide and has the largest share of the approximate $15 Billion/year pizza market. They compete with Pizza Hut, Papa John’s and Little Caesar’s...

Words: 1072 - Pages: 5

Premium Essay

Domino's Pizza Sizzles

...DOMINO’S SIZZLES WITH PIZZA TRACKER 1 Domino’s Sizzle with Pizza Tracker Abstract The purpose of this case study is to exam how Domino’s pizza uses Information Systems to regain their share of the Home Delivery pizza market. I’ll discuss how Domino’s overcome a bad reputation and improved their product and services. I will also discuss the changes and process systems implemented along with where they currently stand in the market and with their customers. I will finish with the technology Domino’s plans to use in the future. DOMINO’S PIZZA SIZZLES WITH PIZZA TRACKER 2 Domino’s Pizza Sizzles with Pizza Tracker This case study discusses the impact that information systems and global e-business has had on Domino’s Pizzas’ reemergence as an industry leader in the home-delivery pizza market. It looks into what kind of systems are used, how the systems improve business performance, how their online pizza ordering system has improved the ordering process and how the systems are giving Domino’s a competitive edge. Domino’s opened in 1960 and grew to 200 stores in 1978 and currently operates almost 9000 stores worldwide and has the largest share of the approximate $15 Billion/year pizza market. They compete with Pizza Hut, Papa John’s and Little Caesar’s along with local pizza shops. Despite being...

Words: 1069 - Pages: 5

Premium Essay

Domino’s Sizzles with Pizza Tracker

...Domino’s Sizzles with Pizza Tracker 1. What kinds of systems are described in this case? Identify and describe the business processes each supports. Describe the inputs, processes, and outputs of these systems. There are three kinds of systems are described in this case. They are the Transaction Processing System (TPS), the Management Information System (MIS), and the Decision Support System (DSS). The Transaction Processing System (TPS) is a computerized system that performs and records the daily routine transactions necessary to conduct business. It is the sales order entry or point of sale (POS) system that captures purchase and payment information. The customer inputs the pizza order that describe the type of pizza crust, the types of pizza toppings, and any side orders. The Transaction Processing System (TPS) then processes the information inputted by the customer and updates Domino’s database with this customer’s pizza order. Next the Management Information System (MIS) helps middle management with administrative activities, controlling, decision- making, and monitoring to see if everything in the process is working well. The Management Information System (MIS) receives transaction data from the Transaction Processing System (TPS) regarding the customer’s order to condense and present this data in reports. Finally the Management Information System (MIS) outputs report information such as type of pizza toppings used, how much time it took to make the pizza, and how long......

Words: 738 - Pages: 3

Premium Essay

Domino's

...INTRODUCTION Domino’s Pizza is an international pizza delivery corporation based in Michigan, United States of America. Domino’s started up in the beginning of the 60’s and as pizza is the most ordered food in Europe, especially in Mexico, therefore in the beginning of the 80’s they opened their first international branch, and this is where Domino’s started to expand. 2. BUSINESS BACKGROUND The World Leader in Pizza Delivery Founded in 1960, Domino's Pizza is the recognized world leader in pizza delivery operating a network of company-owned and franchise-owned stores in the United States and international markets. Domino's Pizza's Vision illustrates a company of exceptional people on a mission to be the best pizza delivery company in the world. (Domino’s website, 2010) Domino’s Pizza is the second largest franchised pizza chain in the U.S.A., and the history of Domino’s Pizza is similar to its rival Pizza hut; two brothers started it with borrowed equity in the sixties. Tom and James Monaghan bought a small Michigan Pizzeria called Dominick's, which was jointly run by them until James traded his share for a second hand car. Tom revitalized the image by changing the name to Domino’s Pizza. Basically Domino’s Pizza’s main job is to provide a wide range of pizza delivery to their customers who are available worldwide. By the late seventies there were over 200 franchise pizza businesses in the States and Domino’s Pizza was ready to go International. In 1983 Domino’s......

Words: 2336 - Pages: 10

Premium Essay

Domino's Pizza

...9 - 5 12 - 00 4 REV: MARCH 19, 2012   "One time permission to reproduce granted by Harvard Business Publishing, 10/9/2012" DAVID E. BELL PHILLIP ANDR EWS MARY SHE LMAN Domino’s Pizza Before 2007, wheat prices didn’t have a pulse. We’d buy for the next six months and the price would be plus or minus 10 cents a bushel over the last six months. Then one day in 2008 wheat shot up $24 a bushel! Now, as a norm, we strategically consider corn, dairy, and wheat to better leverage our supply chain expertise and improve store economics. — John Macksood, executive vice president, Domino’s Pizza On the morning of August 22, 2011, John Macksood, executive vice president for supply chain services at Domino’s Pizza, Inc. (Domino’s), was reading the daily headlines while sitting in his office at the Domino’s World Resource Center, the company’s global headquarters in Ann Arbor, Michigan. Domino’s was the world’s second-largest pizza company and the largest pizza delivery quick-serve restaurant (QSR) chain. One item in particular jumped out at Macksood. An article, titled “Quiznos chain faces tough finance issues,” indicated that Denver-based Quiznos, a privately owned QSR sandwich company with 4,000 U.S. stores, was nearing bankruptcy due to “sharpening competition, waning sales, and debt woes.”1 One of the problems cited was Quiznos’ “protracted battle” with its franchisees over operating costs and profitability, with some franchisees blaming low or nonexistent......

Words: 11553 - Pages: 47

Premium Essay

Domino's

...CASE STUDY: DOMINO’S PIZZA DOMINO’S PIZZA DELIVERS - TO DOMINO’S CHALLENGE: SAVING DOUGH IN A UNIQUE SUPPLY CHAIN Because Domino’s Pizza Distribution delivers only to Domino’s stores, supply-chain inefficiencies can’t be shifted to a trading partner or a retailer. After all, Domino’s is both! On the other hand, efficiencies gained anywhere in the supply chain – from better labor and pallet utilization in the warehouse to optimized deliveries – go directly to the bottom line. Domino’s Pizza is a world leader in pizza delivery, operating a network of more than 7,800 stores in the United States and around the world. To support these stores, Domino’s Pizza Distribution operates 17 domestic distribution centers. CLIENT: “Time saved is the biggest benefit. Using Park City Group, we streamlined the tactical and expanded the strategic. With Park City Group’s order enhancement, we use the time saved to make more strategic decisions that will lower inventory levels. Because distribution centers must never run out of supplies and ingredients, planners pad the safety stock. We’d rather be heavy than wrong. As planners become more confident in their new model they can back off, reducing distribution centers safety stocks – and cutting corporate costs – with no risk of running out.” -Jimmy Simonte, National Director of Inventory Management Domino’s Pizza Distribution To find out more about Park City Group solutions, call us at 435645-2000 or visit us on the web at www.parkcitygroup.com...

Words: 917 - Pages: 4

Premium Essay

Hrm – Essay Dunkin’ Donuts and Domino’s Pizza: Training for Quality and Hustle

...HRM – Essay Dunkin’ Donuts and Domino’s Pizza: Training for Quality and Hustle ANSWER TO QUESTIONS Q 1. What are the strengths and shortcomings of a decentralized approach to training managers and hourly employees? Discuss A 1. Strengths to train hourly employees: On-the job training is provided which give them more practical knowledge They can earn while they learn Performance standards are demanding so their training makes them more tough to handle work load Video cassettes and posters are provided by corporate staff so that they can learn through those videos and apply that in their jobs Shortcomings to train hourly employees: Constant monitoring is not done by corporate staff due to which franchisee owners can skip some training sessions On-the job training means employees are not aware of their corporate headquarters working. Employees should see how their corporate staff actually works They are trained by store managers; therefore, they are bounded only to store operations. Their career will be bounded only up to restaurant operations. Strengths to train Management trainees: Their training program provides them with practical as well as theoretical knowledge They are trained in corporate, therefore, they are aware of how corporate headquarters actually work which will sharpen their skills They have been trained by experienced store managers which give them skills to handle workload as well as they come to know about......

Words: 793 - Pages: 4

Premium Essay

Domino's Pizza Scenario Planning

...Domino’s Pizza Executive summary: Domino’s Pizza is a most important pizza shop in UK and in the world serving one of the best quality pizzas while establishing and maintaining the health standards by using freshly made dough and other products. The plan was to make Domino’s Pizza a well-known brand and to be the first choice for pizza lovers. Domino’s Pizza aim is to produce different multiplicity of pizza and allow customers to customise their own choice of pizzas by offering them variety of toppings. While making their own selection of pizzas with a reasonable price and making important offers attracting in new customers. Domino’s quickly became the premium pizza takeaway, serving locals and focusing on all categories of people (student, family, alone person ...). An exciting menu of 14 different pizzas with an option of having four diverse range of dough. The main aim of Domino’s pizza is to make best quality pizzas and offer best value for the customer, so their values are summed up: “Sell more pizza, have more fun!” Mission: The mission of Domino’s Pizza is to be the best pizza delivery company in the world. Domino’s offers the finest customer services. So, Domino’s pizza has a passion to serve delicious pizzas. Vision: Domino’s Pizza wants to be the pizza first choice in the world that is says to detain half of pizza’s market. They aim to open 50 new stores each year. So today, they are working towards their goal of opening 1,000 stores by......

Words: 6499 - Pages: 26

Premium Essay

Profitability, Efficiency and Liquidity of Domino’s Pizza Enterprises Limited from 2007 to 2011

...Friday, May 11, 2012Profitability, Efficiency and Liquidity of Domino’s Pizza Enterprises Limited from 2007 to 2011 Report prepared for Domino’s Pizza Enterprises LTD Shareholders This document has been prepared for Domino’s Pizza Enterprises LTD shareholders, informing them about the Efficiency, Profitability and Liquidity of the company over the years 2007 to 2011. Efficiency, profitability and liquidity is determined by profitability ratios of the company, which will be compared to industry averages. Profitability, Efficiency and Liquidity of Domino’s Pizza Enterprises Limited from 2007 to 2011 Report prepared for Domino’s Pizza Enterprises LTD Shareholders This document has been prepared for Domino’s Pizza Enterprises LTD shareholders, informing them about the Efficiency, Profitability and Liquidity of the company over the years 2007 to 2011. Efficiency, profitability and liquidity is determined by profitability ratios of the company, which will be compared to industry averages. Friday, May 11, 2012 Profitability, Efficiency and Liquidity of Domino’s Pizza Enterprises Limited from 2007 to 2011 Report prepared for Domino’s Pizza Enterprises LTD Shareholders Executive Summary This report has been prepared to inform shareholders of the profitability, efficiency and liquidity of Domino’s Pizza Enterprises Limited. This report compares profitability ratios of Domino’s Pizza to that of the industry averages to determine its profitability, efficiency and......

Words: 756 - Pages: 4

Premium Essay

Domino's Pizza Case Analysis

...those who are in-charge in marketing and research which includes the chief innovation and creativity officer. III. Central Problem Limited store operation of the Domino’s Pizza IV. Objectives: Must: * To have necessary changes in the business that would be beneficial to the company and essential for its growth. * To maintain loyal customers and gains more. * To increase sales. Want: * To have all the changes are done and used as an edge against competitors. * To become the leading pizza chain in the industry. V. Areas of Consideration Strengths * Domino’s Pizza Inc. is an international company that operates in over 60 countries worldwide. Domino’s Pizza were operated through 489 own stores and 4,558 franchised stores in the United States, and internationally, it operated through 3,726 franchised stores. * They were considered as the leader pizza delivery. Their expertise and passion for delivering hot and fresh pizza has earned the loyalty and of millions of pizza lovers around the world. * Domino’s master franchise system is very beneficial to the company. It helps establish a significant presence in a short span of time as the master franchisees were well versed with the local markets. Weaknesses * Their limited menu leaving them much less able to compete with other fast food pizza chain that also offers delivery. * They did not have dine-in operations. Opportunity * Engaging into a dine-in operation......

Words: 812 - Pages: 4

Premium Essay

Case Analysis Domino's Pizza

...DOMINO'S PIZZA I. Time Context Year 2008 II. View Point The persons involved are those who are in-charge in marketing and research which includes the chief innovation and creativity officer. III. Central Problem Limited store operation of the Domino’s Pizza IV. Objectives: Must: * To have necessary changes in the business that would be beneficial to the company and essential for its growth. * To maintain loyal customers and gains more. * To increase sales. Want: * To have all the changes are done and used as an edge against competitors. * To become the leading pizza chain in the industry. V. Areas of Consideration Strengths * Domino’s Pizza Inc. is an international company that operates in over 60 countries worldwide. Domino’s Pizza were operated through 489 own stores and 4,558 franchised stores in the United States, and internationally, it operated through 3,726 franchised stores. * They were considered as the leader pizza delivery. Their expertise and passion for delivering hot and fresh pizza has earned the loyalty and of millions of pizza lovers around the world. * Domino’s master franchise system is very beneficial to the company. It helps establish a significant presence in a short span of time as the master franchisees were well versed with the local markets. Weaknesses * Their limited menu leaving them much less able to compete with other fast food pizza chain that also offers delivery. ......

Words: 814 - Pages: 4