We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Papa John's (PZZA) Q3 Earnings & Revenues Top, Stock Up
Read MoreHide Full Article
Shares of Papa John’s International, Inc. (PZZA - Free Report) rose over 4% in after-hour trading on Nov 1, after the company reported better-than-expected third-quarter 2016 results.
Notably, the pizza delivery chain also raised its earnings guidance for full-year 2016.
Earnings and Revenue Discussion
Adjusted earnings of 57 cents per share beat the Zacks Consensus Estimate of 50 cents by 14%. Moreover, earnings increased 26.7% year over year owing to higher revenues.
Revenues of $422.4 million exceeded the consensus mark of $420 million by 0.6%. Also, revenues increased 8.5% year over year. The upside reflects higher domestic company-owned restaurants, domestic franchise royalties and fees, domestic commissary and other sales as well as higher international revenues.
Behind the Headline Numbers
Global restaurant sales growth of 7.6% in the third quarter was better than the year-ago growth of 3.9% and 5.9% in the prior quarter.
Excluding foreign currency impact, global restaurant sales growth was 8.9%, which was also better than the year-ago comps growth of 7% and the prior-quarter growth of 7.7%.
Domestic company-owned restaurant sales were up 10.5%, primarily due to a 5.1% increase in equivalent units and a 6.3% rise in comparable sales. Domestic franchise royalties and fees were up 11.2% driven by a 5.1% rise in comparable sales and reduced levels of royalty incentives in 2016. Domestic commissary and other sales were up 6.1% on the back of higher commissary sales.
Comps at system-wide North American restaurants were up 5.5%, higher than 3% comps growth in the year-ago quarter and 4.8% growth last quarter.
International revenues were up 7.2% year over year, as higher royalties and commissary sales were offset by lower company-owned restaurant sales in China. Currency affected international revenues by $3.7 million. Comps at system-wide international restaurants increased 7.6%, weaker than comps growth of 8% a year ago but better than 5.3% growth in the preceding quarter.
Guidance for 2016
Papa John’s has raised its earnings guidance for 2016 to the range of $2.46 to $2.52 per share, up from $2.35 to $2.45 expected previously.
Meanwhile, North America system-wide comps are still projected to rise 3% to 5% and capital expenditures are anticipated between $55 million and $65 million.
Papa John’s has a Zacks Rank #2 (Buy). Other favourably placed stocks in this sector include Domino's Pizza, Inc. (DPZ - Free Report) , Darden Restaurants, Inc. (DRI - Free Report) and The Wendy's Company (WEN - Free Report) . While Domino’s sports a Zacks Rank #1 (Strong Buy), Darden and Wendy's carry the same Zacks Rank as Papa John’s. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Domino’s 2016 earnings moved up 2.4% over the last 60 days. Meanwhile, for full-year 2016, EPS is expected to improve 22.8%.
The Zacks Consensus Estimate for Darden’s fiscal 2017 earnings climbed 1.3% over the last 60 days. The company’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, with an average beat of 9.32%.
Wendy’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, with an average beat of 29.01%. Further, for 2016, EPS is expected to grow 21.2%.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Papa John's (PZZA) Q3 Earnings & Revenues Top, Stock Up
Shares of Papa John’s International, Inc. (PZZA - Free Report) rose over 4% in after-hour trading on Nov 1, after the company reported better-than-expected third-quarter 2016 results.
Notably, the pizza delivery chain also raised its earnings guidance for full-year 2016.
Earnings and Revenue Discussion
Adjusted earnings of 57 cents per share beat the Zacks Consensus Estimate of 50 cents by 14%. Moreover, earnings increased 26.7% year over year owing to higher revenues.
Revenues of $422.4 million exceeded the consensus mark of $420 million by 0.6%. Also, revenues increased 8.5% year over year. The upside reflects higher domestic company-owned restaurants, domestic franchise royalties and fees, domestic commissary and other sales as well as higher international revenues.
Behind the Headline Numbers
Global restaurant sales growth of 7.6% in the third quarter was better than the year-ago growth of 3.9% and 5.9% in the prior quarter.
Excluding foreign currency impact, global restaurant sales growth was 8.9%, which was also better than the year-ago comps growth of 7% and the prior-quarter growth of 7.7%.
Domestic company-owned restaurant sales were up 10.5%, primarily due to a 5.1% increase in equivalent units and a 6.3% rise in comparable sales. Domestic franchise royalties and fees were up 11.2% driven by a 5.1% rise in comparable sales and reduced levels of royalty incentives in 2016. Domestic commissary and other sales were up 6.1% on the back of higher commissary sales.
Comps at system-wide North American restaurants were up 5.5%, higher than 3% comps growth in the year-ago quarter and 4.8% growth last quarter.
International revenues were up 7.2% year over year, as higher royalties and commissary sales were offset by lower company-owned restaurant sales in China. Currency affected international revenues by $3.7 million. Comps at system-wide international restaurants increased 7.6%, weaker than comps growth of 8% a year ago but better than 5.3% growth in the preceding quarter.
Guidance for 2016
Papa John’s has raised its earnings guidance for 2016 to the range of $2.46 to $2.52 per share, up from $2.35 to $2.45 expected previously.
Meanwhile, North America system-wide comps are still projected to rise 3% to 5% and capital expenditures are anticipated between $55 million and $65 million.
PAPA JOHNS INTL Price, Consensus and EPS Surprise
PAPA JOHNS INTL Price, Consensus and EPS Surprise | PAPA JOHNS INTL Quote
Zacks Rank & Stocks to Consider
Papa John’s has a Zacks Rank #2 (Buy). Other favourably placed stocks in this sector include Domino's Pizza, Inc. (DPZ - Free Report) , Darden Restaurants, Inc. (DRI - Free Report) and The Wendy's Company (WEN - Free Report) . While Domino’s sports a Zacks Rank #1 (Strong Buy), Darden and Wendy's carry the same Zacks Rank as Papa John’s. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Domino’s 2016 earnings moved up 2.4% over the last 60 days. Meanwhile, for full-year 2016, EPS is expected to improve 22.8%.
The Zacks Consensus Estimate for Darden’s fiscal 2017 earnings climbed 1.3% over the last 60 days. The company’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, with an average beat of 9.32%.
Wendy’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, with an average beat of 29.01%. Further, for 2016, EPS is expected to grow 21.2%.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>