Domino’s Pizza (NASDAQ: DPZ) delivered what investors wanted in Q3, sending its stock price into a reversal that could add 20% to the stock price this year and 100% or more over the long term. Investors wanted a better-than-expected report that affirmed the company’s growth outlook, valuation, and capacity for aggressive capital returns.
Aggressive capital returns equate to a dividend distribution that annualizes to 1.7% with shares near their long-term lows, increasing annually, and share buybacks. The share buybacks are of particular interest, as they reduced the count by an average of 2.6% over the preceding 12 months and are expected to remain robust in FQ4 and the subsequent fiscal year.
