Domino’s Pizza party outlasts the lockdown

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A pizza comes out of the oven at Domino's Pizza restaurant in Los Angeles, California, U.S. July 18, 2018. REUTERS/Lucy Nicholson

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NEW YORK, July 22 (Reuters Breakingviews) - Some pandemic habits aren’t going anywhere. Domino’s Pizza (DPZ.N) said on Thursday that sales increased more than 12% in the second quarter this year compared with the same quarter last year, with two-year same store sales up a fifth domestically. Turns out, piping hot pizza delivered to the door is delicious whether or not government officials are forcing people to stay inside.

Ritch Allison, chief executive of the Michigan-based pie company, mentioned China as one of the company’s most exciting markets, while Japan, Germany and Turkey were also key. American eaters were still hearty, but franchises elsewhere are growing at a faster clip.

Investors, who now include hedge fund mogul Bill Ackman read more , handed the shares a more than 16% boost. With an enterprise value approaching 30 times the coming year’s estimated EBITDA, a nearly 50% premium to Papa John’s International (PZZA.O), the stock on the one hand looks bloated. But viewed as a multiple of 5 times sales, versus DoorDash’s (DASH.N) 11 times, it’s downright slim. Domino’s grasp of so-called last-mile delivery, twinned with diners’ enduring taste for pizza parties, suggests it deserves extra topping. (By Lauren Silva Laughlin)

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Editing by John Foley and Amanda Gomez

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