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Dominos Pizza and the price of flour

Analysing companies' finances and value from their financial statements using ratios and formulae
TheMotorcycleBoy
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Re: Dominos Pizza and the price of flour

#497656

Postby TheMotorcycleBoy » April 30th, 2022, 11:03 am

ADrunkenMarcus wrote:It will be interesting to see what happens as regards their German interests.

So do LON:DOM own these German interests, or does the Australian venture which Westmoreland mentioned?

thanks Matt

westmoreland9
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Re: Dominos Pizza and the price of flour

#497743

Postby westmoreland9 » April 30th, 2022, 8:13 pm

TheMotorcycleBoy wrote:
ADrunkenMarcus wrote:It will be interesting to see what happens as regards their German interests.

So do LON:DOM own these German interests, or does the Australian venture which Westmoreland mentioned?

thanks Matt


DOM is a 33% shareholder IIRC. there is a put / call option based on a fixed multiple of ebitda which i believe domino's australia can exercise for around £100m at the moment. i expect that would be paid back in a special dividend and / or buybacks.

DOM should be able to grow to about 1600 stores which is about 35% growth. they have a long term record of positive store level growth, and a combination of dividends and share buybacks should see to a solid investment performance over the medium term.

the days of explosive growth are behind it, but if you can get it on a 3% dividend yield, i think that's reasonable value given the predictability and stability of earnings growth.

TheMotorcycleBoy
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Re: Dominos Pizza and the price of flour

#497821

Postby TheMotorcycleBoy » May 1st, 2022, 11:28 am

westmoreland9 wrote:
TheMotorcycleBoy wrote:
ADrunkenMarcus wrote:It will be interesting to see what happens as regards their German interests.

So do LON:DOM own these German interests, or does the Australian venture which Westmoreland mentioned?

thanks Matt


DOM is a 33% shareholder IIRC. there is a put / call option based on a fixed multiple of ebitda which i believe domino's australia can exercise for around £100m at the moment. i expect that would be paid back in a special dividend and / or buybacks.

DOM should be able to grow to about 1600 stores which is about 35% growth. they have a long term record of positive store level growth, and a combination of dividends and share buybacks should see to a solid investment performance over the medium term.

the days of explosive growth are behind it, but if you can get it on a 3% dividend yield, i think that's reasonable value given the predictability and stability of earnings growth.

Yes. I'm in agreement here. Currently on about 2.81% DY according to google.

ADrunkenMarcus
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Re: Dominos Pizza and the price of flour

#497829

Postby ADrunkenMarcus » May 1st, 2022, 11:56 am

TheMotorcycleBoy wrote:Yes. I'm in agreement here. Currently on about 2.81% DY according to google.


It's about 3 percent on a forward basis, using the estimated 10.4p a share dividend for 2022 and the 347p closing share price. The dividend growth from Domino's is such that, if the estimated 12.1p dividend for 2024 materialises, I will be getting a 10.5 percent nominal dividend yield on the shares I bought in 2010.

Best wishes


Mark.

westmoreland9
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Re: Dominos Pizza and the price of flour

#500633

Postby westmoreland9 » May 15th, 2022, 9:17 pm

here's food for thought. domino's pizza enterprises (Australia listed), who own the master franchise to a number of markets, aus, japan, and many in europe, are down 45% YTD. on earnings measures, the shares are considerably more expensive than DPG, but they are far more capable operators with a track record of delivering excellent growth in all their markets. as i said before, they also turned the german operation around after DPG screwed it up.

they believe they can double store count in the next 8 years or so, and they tend to deliver on their ambitions. dividend yield is currently around 2.5% compared to around 3% with DPG.


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