How the Domino’s Pizza (ASX: DMP) share price rocketed over 60% last year

The Domino’s Pizza share price went crazy during 2020. We talk about how Domino’s managed to achieve such massive gains.
The post How the Domino’s Pizza (ASX: DMP) share price rocketed over 60% last year appeared first on The Motley Fool Australia. –

woman holding pizza

Domino’s Pizza Enterprises Ltd (ASX: DMP) had a ripper 2020. The Domino’s share price had a 52-week range between roughly $41 to $98 last year, and is currently trading around $88.

So what went down last year that led to such monstrous growth, and will the Domino’s share price be able to keep up momentum as we welcome 2021?

Digital orders and new store openings

According to the company’s FY20 results, Domino’s online sales jumped over 21% year-on-year. People are so happy to order from Domino’s that its latest Investor Day Presentation notes that the company spent time as the number one most downloaded app in Australia. In fact, Dominos has now reached monopoly status when comparing its app downloads to those of McDonald’s, KFC, Uber Eats and Menulog.

The market presentation further notes that the company added 163 new stores during FY20 — 75 of those stores were opened in Japan, resulting in an impressive sales bump of 25.9%. Europe sales and sales in the Australia and New Zealand market also posted gains of 5.1% and 4.1%, respectively.

Improving pizza quality with the DOM Pizza Checker

In its 2020 annual report, Domino’s advised that the company has now used the DOM Pizza Checker to scan more than 50 million pizzas since first launching the technology in May 2019.

According to the Pizza Checker website, “DOM Pizza Checker uses advanced machine learning, artificial intelligence and sensor technology to identify pizza type, even topping distribution and correct toppings.”

The Pizza Checker then assigns a grade to each pizza. If the grade doesn’t meet standards, meaning the pizza doesn’t quite look the way a customer will expect, the pizza is remade. 

What will the Domino’s share price do in 2021?

Throughout the reports produced during FY20, the company reiterates an aggressive strategy to both maintain and grow its present customer base. Will Domino’s be able to keep up its digital dominance as we take off into 2021? Will the DOM Pizza Checker continue to hold up the promise that pizzas delivered consistently meet expectations?

Goldman Sachs thinks so. Goldman pointed to Domino’s expansion in Germany and Japan as positive indicators of what lies ahead. The broker also noted some downside risk based on last year’s underperformance in France due to COVID-19 restrictions. With six months left of FY21, Domino’s will no doubt have many investors keeping an eye out.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

Motley Fool contributor Gretchen Kennedy has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Collins Foods Limited and Domino’s Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post How the Domino’s Pizza (ASX: DMP) share price rocketed over 60% last year appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!