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Domino’s Pizza Share Price Just Crashed 14%. Here’s Why

Practice Stock Trading
Updated: 15 October 2020

Shares of Domino’s Pizza Group PLC (LON: DOM) fell 14% today after the company said its orders dropped 8% compared to 2019.

The pizza-delivery company expects its underlying profit before tax for the full year to arrive between £93 million and £98 million. This is in line with the analysts’ consensus.

Reporting on the 13 weeks ending September 27, Domino’s said sales rose 19% to £342 million after the VAT rate was slashed to 5% from 20% in July by the Government. On the other hand, international sales fell by 5%.

Investors are concerned about Domino’s long-term business plan given that one of its main rivals, Just Eat Takeaway, saw its orders jump by 43%.

Orders at Domino’s collection business unit plunged by 40%

“Financial year 2020 guidance has been kept within the current consensus range despite the revenue uplift from higher royalties driven by VAT reduction indicating the growing degree by which the underlying business is now going backwards,” analysts from Liberium wrote in a note.

Domino’s Pizza share price fell 14% on the lower order count October 2020

Domino’s Pizza share price fell 14% to 320.8p, a new 2-month low.

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