WRAPUP 1-Investors seem to favor Papa John's over Domino's
* Domino's Q4 EPS $0.19 vs. Wall Street view $0.17
* Domino's says negative forex to negate int'l gains
* Papa John's Q4 ADJ EPS $0.48 vs Wall St view $0.41
* Papa John's raises '09 ADJ EPS forecast to $1.36 to $1.44
LOS ANGELES, Feb 24 (Reuters) - Investors seemed to prefer Papa John's International Inc (PZZA.O) to Domino's Pizza Inc (DPZ.N) after the pizza delivery chains reported earnings on Tuesday.
Pizza has been intensely competitive as those companies and Yum Brands Inc's (YUM.N) Pizza Hut fight to win and keep customers, who are preparing more meals at home as unemployment rises and home values sink.
Many analysts believe that Pizza Hut, which recently rolled out pasta and lasagna, is more than holding its own while Domino's struggles and Papa John's carves out its own higher-end niche with pies that don't skimp on cheese or toppings.
Before the opening bell of the stock market on Tuesday, Domino's posted a fourth-quarter profit that fell 32 percent in the fourth quarter, but still beat Wall Street estimates. [ID:nN24353950]
Its shares sank more than 27 percent in early trade on lingering liquidity concerns and worries that its international business would weaken if the U.S. dollar continued to strengthen.
Domino's shares ended the day down 5.2 percent to $6.15 on the New York Stock Exchange.
The company said that for 2009, it expects "significant negative impact on royalties from foreign currency movements," flat sales at established U.S. outlets, and the number of its domestic stores to decline.
Domino's is also assuming commodity costs will ease and that its international business will post same-store sales growth of 2 percent to 4 percent.
Standard & Poor's equity research analyst Mark Basham said, "For 2009, we expect key international markets to experience significant economic stress, and we think this will be the most significant factor in lower '09" earnings before items. He maintained his "sell" recommendation on Domino's shares.
PAPA POSTS PROFIT, RAISES OUTLOOK
After the closing bell, Papa John's posted adjusted quarterly earnings that beat Wall Street's view and boosted its full-year profit outlook, citing lower ingredient costs and a strong start to 2009. Its shares, which closed down 2.1 percent to $19.88, held their ground in after-hours trade [ID:nN24437976]. Continued...
