Why the Domino's (ASX:DMP) share price is up 27% in August

Domino's shareholders are enjoying a hot and tasty treat this month.

| More on:
A couple of friends at a rooftop party enjoying some hot and tasty Domino's pizza

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Domino's Pizza Enterprises Ltd. (ASX: DMP) share price has been on fire in August. Shares in the pizza franchise are surging 27.3% higher this month to $148.50 per share at Friday's close.

Here's what's boosting the company's value higher in the last month.

Why the Domino's share price is up 27% in August

The only price-sensitive ASX announcement from Domino's this month was the release of its full-year results.

If you missed it, some of the key highlights from the 18 August Domino's results are below:

  • Network sales increased 15% on the prior corresponding period (pcp) to $3.7 billion
  • Online sales up 21.5% on pcp to $2.9 billion
  • Net profit after tax up 29% on pcp to $188.2 million
  • Earnings per share (EPS) up 29% on pcp to 217.6 cents
  • Final dividend of 85.1 cents, translating to a 173.5 cent full-year dividend

The Domino's share price jumped higher following the release of their results earlier this month. It's been good news for shareholders in the weeks since, with the pizza franchise's shares now up 27% in August.

Those strong gains have come despite broad lockdowns across Australia, particularly Sydney and Melbourne. However, this is not a new phenomenon for Domino's.

When the COVID-19 restrictions were first introduced in March 2020 and the S&P/ASX 200 Index (ASX: XJO) slumped lower, the Domino's share price bucked the trend.

While the pizza company's shares did fall 25% lower, that pales in comparison to the losses amongst some of its ASX 200 peers.

One key factor was Domino's ability to shift to an online strategy and maintain some sales momentum while much of the economy was put into hibernation.

In fact, Domino's value has surged 214% higher since 20 March last year to its current $12.9 billion market capitalisation.

It looks like investors are expecting more of the same amid the current restrictions given the recent gains.

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Dominos Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Gainers

A man looking at his laptop and thinking.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a disappointing hump day session for the ASX today.

Read more »

The silhouettes of ten people holding hands with their arms raised against the sky, as the sun rises or sets in the background.
Share Gainers

Here are the top 10 ASX 200 shares today

The ASX managed to bank a small rise this Tuesday.

Read more »

Sport trainer talking to little girl who is climbing wooden ladder in gym.
Share Gainers

Why Vault Minerals, Droneshield, Westgold Resources shares are climbing higher today

These shares are gaining on Tuesday, but why?

Read more »

A young woman smiles as she rides a zip line high above the trees.
Financial Shares

5 best ASX 200 financial shares of FY25 (CBA didn't make the cut!)

These stocks were well and truly 'in the black' for share price growth last financial year.

Read more »

Excited group of friends sitting on sofa watching sports on TV and celebrating.
Share Gainers

Why Amaero, Black Cat, Domino's, and Ramelius shares are racing higher today

These shares are having a good session on Tuesday. But why?

Read more »

Ten happy friends leaping in the air outdoors.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a rough start to the trading week for investors this Monday.

Read more »

two computer geeks sit across from each other with their laptop computers touching as they look confused and confounded by what they are seeing on their screens.
Share Gainers

ASX tech shares outperformed US tech stocks by 2:1 in FY25. Here's why

Forget the Magnificent 7! Aussie tech shares had twice as much price growth as US tech stocks in FY25.

Read more »

Three happy office workers cheer as they read about good financial news on a laptop.
Share Gainers

Why Bellevue Gold, Cobram, Hub24, and Nanosonics shares are pushing higher

These shares are starting the week on a positive note. But why?

Read more »