11 Best Fast Food Stocks To Invest In Right Now

2. Domino’s Pizza, Inc. (NYSE:DPZ)

Number of Hedge Fund Holders: 52

Domino’s Pizza, Inc. (NYSE:DPZ) is an American pizza company with a significant global presence, operating around 20,500 stores in over 90 markets.

In December 2023, Domino’s Pizza, Inc. (NYSE:DPZ) announced a five-year strategy called ‘Hungry for MORE’, which would serve as a blueprint for driving sales, expanding units, and improving profits. The acronym MORE implied “most delicious food”, “operational excellence”, “renowned value”, and “enhanced by best-in-class franchisees and team members.”

CEO Russell Weiner, while speaking to the Q3 earnings call last month, stated that while drafting this strategy, Domino’s was aware of the looming consumer spending crisis in 2024, and the company focused on offering the strongest value to consumers through promotional offerings, giving them ‘more for less’. The strategy has proven to be a great success.

Retail sales have surged 6.6% during the first three quarters of 2024, while the broader QSR pizza industry has grown by only 2%. Q3 was the fourth successive quarter of same-store sales growth since the launch of the strategy in December last year, and the fourth straight quarter of positive order count growth.

Domino’s Pizza, Inc. (NYSE:DPZ) has also been expanding at a rapid scale. Between 2015 and 2023, the company opened around 1,750 new stores. This was almost as much as the stores its pizza competitors in the QSR industry closed during the period. This impressive rate of opening is likely to prove to be the catalyst driving future order count growth, as customers continue to repeat purchases because of the value offered by Domino’s.

In Q3 2024, the company posted $52.8 million in revenue, up 5.1% from last year. This was attributed to higher order volumes and an increase in Domino’s food basket pricing to stores. US franchise advertising and US franchise royalties and fees also increased during the quarter. Income from operations increased 5% year-over-year. EPS was logged at $4.19, comfortably beating expectations of $3.71 per share.

Considering a robust performance over the past year, Wall Street analysts have a consensus Buy rating on DPZ, with a median share price upside potential of 11.6%. Domino’s Pizza, Inc. (NYSE:DPZ) is one of the best fast food stocks to invest in right now, with 52 hedge funds, amongst those tracked by Insider Monkey, having a stake in the company as of the end of Q2 2024.