UBS Maintains "Buy" Rating on Domino's Pizza (NASDAQ:DPZ) Amid Mixed Q2 Earnings

Domino's Pizza (NASDAQ:DPZ) reported mixed second-quarter earnings with revenue slightly above expectations but EPS falling short. The company highlighted growth in delivery and carryout services in the U.S., contributing to significant market share gains. Despite a slight decline post-earnings announcement, Domino's shares rose approximately 5% in early trading due to strong U.S. same-store sales driven by new menu items and strategic promotions.

On July 22, 2025, UBS reiterated its "Buy" rating for Domino's Pizza (NASDAQ:DPZ), with the stock priced at $473.77. Domino's, a leading player in the pizza quick-service restaurant (QSR) category, is known for its extensive menu and strong market presence. The company competes with other major pizza chains like Pizza Hut and Papa John's.

Domino's reported mixed second-quarter earnings, with revenue reaching $1.15 billion, slightly above the analyst consensus of $1.14 billion. However, its earnings per share (EPS) fell short at $3.81, compared to the expected $3.93. Despite this, CEO Russell Weiner remains optimistic, citing growth in delivery and carryout services in the U.S., which contributed to significant market share gains.

The company's strategic advantages include partnerships with the two largest aggregators, a comprehensive range of crust options, and strong unit economics. Domino's also boasts the largest advertising budget, a robust supply chain, and an expanded rewards program. These factors have helped the company maintain its competitive edge in the U.S. pizza QSR category.

Domino's shares experienced a slight decline of 0.8% after the earnings announcement, closing at $462.24. However, the stock later rose by approximately 5% in early trading, as highlighted by Fast Company, due to exceeding analysts' expectations for U.S. same-store sales. This was driven by new menu items and strategic promotions, despite ongoing macroeconomic uncertainties.

The company reported a 14.9% increase in income from operations and a 3.4% growth in U.S. same-store sales for the second quarter of 2025. The successful launch of the Parmesan-stuffed-crust pizza played a key role in boosting transaction counts and increasing the average ticket price. This strategic move into the stuffed-crust segment has strengthened Domino's market position.