Luke Juricic
2 min read
Investing.com — Shares of Domino’s Pizza Inc (NASDAQ:DPZ) rose 2.5% in morning trade Friday after Baird upgraded the stock to Outperform from Neutral, with analyst Analyst Chris O’Cull citing what he called a “clearer path to better SSS performance and franchisee profitability”. O’Cull lifted his price target to $400 from $320 following recent meetings with management, pointing to a more balanced promotional strategy that supports average ticket performance without disrupting transaction volume.
The upgrade underscores growing Wall Street confidence that the pizza chain can shift from traffic-led growth toward more profitable order expansion. While Domino’s has maintained healthy order growth, overall ticket sizes have faced pressure from smaller basket sizes, extended promotional windows, and limited menu pricing.
To address that dynamic, management is shortening deal windows and rolling out menu additions designed to encourage add-on purchases rather than relying on direct price increases. O’Cull noted that average ticket improved sequentially in the third quarter and is expected to strengthen further in the fourth quarter as those adjustments gain traction.
“Our thesis does not require transaction growth to accelerate or even hold its current pace; stabilizing ticket while sustaining positive transaction growth should improve overall SSS and franchisee profits,” O’Cull wrote. Although weaker performance in 2026 will likely weigh on 2027 unit expansion, the analyst suggested investors largely anticipate the slowdown, while easier sales comparisons and early signs of stabilization at Domino’s Pizza Enterprises could bolster sentiment.
Separately, BMO Capital analyst Andrew Strelzik reiterated an Outperform rating and a $390 price target after hosting Domino’s chief financial officer and investor relations team for investor meetings. Strelzik noted that management sounded confident regarding order momentum and ticket rebuild plans, adding that “our sense is The Domino is off to a solid start” and that “we continue to see favorable risk/reward for a consistent market share winner with potential for comp acceleration against easier compares.”
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