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.