July 15, 2025 a 07:47 am
DPZ: Dividend Analysis - Domino's Pizza, Inc.
Domino's Pizza exhibits a stable dividend profile with a consistent history of dividends spanning 18 years. The company's current dividend yield is modest but competitive in its sector. Despite challenges in the market, Domino's continues to provide reliable returns, making it an attractive option for dividend-focused investors.
📊 Overview
Domino's Pizza operates within the Consumer Discretionary sector, specifically focusing on food delivery. Its dividend yield of 1.77% is accompanied by a current annual dividend of $6.05 per share. Having delivered dividends for 18 consecutive years, the company has built a reputation for maintaining investor confidence. No recent cuts or suspensions in dividends have been recorded.
| Metric | Value |
|---|---|
| Sector | Consumer Discretionary |
| Dividend yield | 1.77 % |
| Current dividend per share | 6.05 USD |
| Dividend history | 18 years |
| Last cut or suspension | None |
📉 Dividend History
The dividend history provides insights into the company's commitment to returning capital to its shareholders. A consistent payment history is indicative of financial health and operational stability. It is crucial for assessing the risk of future dividend performance.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 3.48 |
| 2024 | 6.04 |
| 2023 | 4.84 |
| 2022 | 4.40 |
| 2021 | 3.76 |
📈 Dividend Growth
Dividend growth is a critical indicator of a company's future valuation potential and its ability to increase shareholder returns over time. Domino's Pizza shows dividend growth of 17.12% over the last 3 years and 18.36% over the past 5 years, reflecting its commitment to enhancing shareholder value.
| Time | Growth |
|---|---|
| 3 years | 17.12 % |
| 5 years | 18.36 % |
The average dividend growth is 18.36% over 5 years. This shows moderate but steady dividend growth.
🗣️ Payout Ratio
The payout ratio indicates how much of a company's earnings are distributed as dividends. A payout ratio of 34.46% based on EPS suggests that Domino's retains a significant portion of its earnings for future business reinvestments. FCF payout ratio stands at 36.12%, highlighting a stable cash flow situation suitable for sustaining dividend payments.
| Key figure | Ratio |
|---|---|
| EPS-based | 34.46 % |
| Free cash flow-based | 36.12 % |
The relatively low payout ratios indicate that the company maintains a conservative approach, ensuring dividends are well-covered by both earnings and cash flow.
✅ Cashflow & Capital Efficiency
Analyzing cash flow and capital efficiency provides insights into how well a company utilizes its resources to generate returns and whether it can sustain its financial operations.
| Year | 2022 | 2023 | 2024 |
|---|---|---|---|
| Free Cash Flow Yield | 3.14 % | 3.36 % | 3.50 % |
| Earnings Yield | 3.65 % | 3.59 % | 3.90 % |
| CAPEX to Operating Cash Flow | 18.35 % | 17.84 % | 18.06 % |
| Stock-based Compensation to Revenue | 0.63 % | 0.83 % | 0.92 % |
| Free Cash Flow / Operating Cash Flow Ratio | 81.65 % | 82.16 % | 81.94 % |
The company's capital efficiency metrics reveal sound operational management, supporting sustained dividend payouts and growth prospects.
📊 Balance Sheet & Leverage Analysis
Understanding the balance sheet and leverage metrics helps investors assess financial stability and risk. A strong balance sheet with manageable debt is crucial for sustaining dividends.
| Year | 2022 | 2023 | 2024 |
|---|---|---|---|
| Debt-to-Equity | -1.25 | -1.28 | -1.31 |
| Debt-to-Assets | 3.28 | 3.11 | 2.99 |
| Debt-to-Capital | 4.94 | 4.57 | 4.21 |
| Net Debt to EBITDA | 6.10 | 5.48 | 4.98 |
| Current Ratio | 1.47 | 1.49 | 0.56 |
| Quick Ratio | 1.32 | 1.34 | 0.52 |
| Financial Leverage | -0.38 | -0.41 | -0.44 |
Domino's financial leverage is within reasonable limits, indicating good risk management, although the negative equity could imply higher risk.
📊 Fundamental Strength & Profitability
Fundamentals and profitability ratios are crucial for understanding the company's efficiency, performance, and competitive position within the market.
| Year | 2022 | 2023 | 2024 |
|---|---|---|---|
| Return on Equity | -10.80 % | -12.75 % | -14.74 % |
| Return on Assets | 28.23 % | 30.99 % | 33.63 % |
| Margins: Net | 9.97 % | 11.59 % | 12.41 % |
| EBIT | 16.99 % | 18.95 % | 19.51 % |
| EBITDA | 18.76 % | 20.75 % | 21.37 % |
| Gross | 36.34 % | 38.56 % | 39.27 % |
| Research & Development to Revenue | 0.00 % | 0.00 % | 0.00 % |
While ROE is negative, which is concerning, the company's return on assets and margin figures are robust, indicating operational efficiency.
📈 Price Development
✅ Dividend Scoring System
| Criteria | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 4 | |
| Dividend growth | 4 | |
| Payout ratio | 5 | |
| Financial stability | 3 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 3 |
Overall Score: 31 out of 40
🗣️ Rating
Domino's Pizza offers a promising dividend profile with a consistent history and encouraging growth trends. While there are some areas of financial caution, notably negative equity, the overall stability and performance metrics suggest that it remains a viable option for investors targeting resilient dividend stocks.