U.S. stock futures are indicating a sharply higher Thursday open on Wall Street, as the Fed's dovish stance fuels hopes for future interest rate cuts.Morning Briefread more
Stock futures are surging after the Fed signaled interest rate cuts may begin as early as July.US Marketsread more
A surface-to-air missile shot down a U.S. military drone over the Strait of Hormuz, a U.S. official said Thursday.World Politicsread more
President Donald Trump has publicly blamed the Federal Reserve's interest rates hikes for holding back U.S. economic growth.The Fedread more
Slack's public market debut on Thursday will generate billions for venture firm Accel and healthy returns for Andreessen Horowitz and Social CapitalTechnologyread more
While the Federal Reserve still sees no rate cut in 2019, traders are convicted a rate reduction is coming as soon as July.Marketsread more
Beyond Meat has blown up. The plant-based meat company is now larger than 80 S&P 500 companies, including Macy's, Xerox and Mylan.Trading Nationread more
Goldman Sachs lowered its price target on Tesla over concerns about demand.Marketsread more
China's President Xi Jinping arrived in Pyongyang on Thursday morning for a state visit to North Korea — the first by a Chinese state leader in 14 years. Experts say the move...Asia Politicsread more
Gold prices spiked in the afternoon of Asian trading hours on Thursday after a dovish U.S Federal Reserve opened the door to further rate cuts, and the 10-year Treasury yield...Metalsread more
In an area responsible for the shipment of one-third of the world's seaborne oil, just how high could military confrontation — or indeed, an outright war — send the price of...Oilread more
Domino's shares skidded more than 9 percent Thursday after the pizza chain disappointed investors with sales growth that fell short of expectations.
The stock is on pace for its worst day since July 25, when shares plunged more than 10 percent.
"Same-store sales performance can certainly improve versus what we have all come to expect, but I am pleased to see all our comp coming from order growth," CEO Ritch Allison told analysts on the conference call.
Domino's, which has a $10.5 billion market value, has been expanding rapidly in order to decrease delivery times and allow drivers to earn more tips, a strategy that the company calls "fortressing." During its fourth quarter, the company opened a net 560 stores, with a net 125 new U.S. locations.
But U.S. same-store sales rose 5.6 percent, short of the 6.9 percent growth analysts had predicted during the quarter. The company said that fortressing impacted domestic same-store sales in 2018 by as much as 1.5 percent. Even with that hit to same-store sales, Allison said on CNBC's "Power Lunch " that fortressing is an investment that the company is "more than willing" to make.
"The softer than expected domestic comps could partially reflect an accelerated impact from fortressing as the company opened 125 domestic locations on a net basis in 4Q (+5.7%), in excess of our estimate for 106 net openings and Consensus Metrix's 101," Cowen analyst Andrew Charles said in a research note.
The quarter ended Dec. 30, pushing New Year's Eve pizza sales to the current quarter. CFO Jeff Lawrence told analysts that the calendar change from 2017 negatively impacted same-store sales growth by 0.5 percent.
Domino's, which surpassed 10,000 locations open outside of the U.S. last year, also fell short on international same-store sales growth, reporting a 2.4 percent increase. Analysts expected to see international same-store sales grow by 4.1 percent during the quarter.
Here's what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
Domino's said that its loyalty program has been a meaningful driver of traffic and has surpassed over 20 million active users. Earlier this month, it launched a promotion for loyalty program members that allows them to earn points for free Domino's pizza for eating slices from anywhere — even from Pizza Hut or Papa John's.
The pizza chain reported fiscal fourth-quarter net income of $111.6 million, or $2.62 per share, up from $93.3 million, or $2.09 per share a year earlier. The company attributed the increase to a lower tax rate resulting from tax reform legislation in 2017.
Excluding items, Domino's earned $2.62 per share, missing the $2.69 per share expected by analysts surveyed by Refinitiv.
Net sales rose 21 percent to $1.08 billion, but still missed Wall Street's expectations of $1.10 billion. Higher U.S. franchise royalties and fee revenues, as well as higher sales at company-owned stores in the U.S., contributed to the revenue increase. However, negative impacts from foreign currency resulted in a decline in international franchise royalties and fees.
The company does not release forecasts for quarterly or annual earnings, but it did reaffirm its outlook for the next three to five years. It expects global retail sales growth of 8 to 12 percent and U.S. same-store sales growth of 3 to 6 percent.
Domino's also announced Thursday it is raising its quarterly dividend by 18 percent to 65 cents.