Why the Domino’s Share Price Rose Today

What happened to the Domino’s share price?

Shares of Domino’s Pizza Enterprises Limited [ASX:DMP] gained 2.44% on Monday.

Why did Domino’s shares do this?

Domino’s had an incredible 2015. DMP shares gained a massive 125%. They started 2015 at $25 per share, and closed the year around $56. There are very few large-cap shares that can pull off this sort of growth in 12 months.

However, as the markets are taking a beating this year, DMP shares look like a safe place to park some dough for investors. Since the trading year began, DMP shares reached a peak of $61.03 at the start of February.  Since then, this hot momentum trade has fallen 8.94%.

Aussies are chasing companies like DMP. It pays a dividend of 51.8 cents for 2015. It has almost tripled its revenue in the past five years. Growing from $233 million in 2010 to $647 million in 2015. And net profit is 3.5 times higher in the same period, rising from $17 million in 2010 to $64 million last year. Even with it’s incredibly price to earnings ratio of 57 times, Aussie investors are still happy to buy shares.

What now for Domino’s Ltd?

I’ve been a fan of DMP for quite some time. However, the current P/E means investors might want to avoid this stock for now. The volatile price does create opportunities for short term traders however.

In saying that, DMP has a habit of rallying hard when they announce financial results. They are due to report interim results in two days.

Shae Russell,
Money Morning


Since starting out in the financial markets over a decade ago, Shae has extensive experience across various aspects of the industry. Shae cut her teeth in the derivatives industry, teaching clients basic trading techniques with technical analysis.

Joining Port Phillip Publishing eight years ago, Shae has worked across a number of publications, such as Australian Small-Cap Investigator, Gold Stock Trader and Microcap Trader. She’s spent the past two years however, honing her macro analysis skills alongside Jim Rickards, showing Australians how to invest and profit form global macro trends.

Drawing on her extensive experience, Shae is a contributor to Money Morning, and lead editor of sister-publication Markets & Money, where she looks at broad macro trends developing around the world, combining them with her distaste for central banks and irrational love of all things bullion.


Money Morning Australia