It’s Time to Load Up on This Iconic Dividend Stock
It has been a volatile stretch for investors in Domino’s Pizza (NASDAQ: DPZ). After climbing to a 52-week high of nearly $500, shares of the world’s largest pizza company have experienced a sharp drawdown. Such a steep drop might prompt investors to wonder whether the underlying business is losing its edge in a highly competitive restaurant landscape. But a closer look at the company’s recently reported fourth-quarter results suggests it isn’t. Instead of a struggling operation, the numbers reveal a resilient business generating massive amounts of cash and aggressively returning it to shareholders. Will AI create the world’s first trillionaire? Our team just released a report on the one little-known company, called an “Indispensable Monopoly” providing the critical technology Nvidia and Intel both need. Continue » For investors looking to add a durable dividend payer to their portfolio, this sell-off has created an opportunity that is arguably too good to pass up. Image source: Getty Images. Steady revenue and mouth-watering cash flow Despite facing a challenging macroeconomic environment that has pressured consumer spending across the quick-service restaurant industry, Domino’s continues to find ways to win. The company’s fourth-quarter revenue rose 6.4% year over year to $1.53 billion. This steady top-line performance was driven in part by a 3.7% increase in U.S. same-store sales, demonstrating that the company’s value-oriented promotions and revamped loyalty program are successfully driving order volume. And Domino’s bottom line looked even better. Its fourth-quarter earnings per share came in at $5.35, up 9.4% from $4.89 in the year-ago quarter. Further, the company’s store footprint continues to expand rapidly, with Domino’s adding 776 net new stores globally in fiscal 2025 alone. But the most impressive metric from the company’s fiscal 2025 results was its cash generation. For the full year, free cash flow surged 31.2% year over year to about $672 million. Returning capital to shareholders With so much cash flowing through the business, Domino’s management has not been shy about sharing the wealth. The company recently approved a 15% increase to its quarterly dividend, bringing the payout to $1.99 per share. And dividends are just one part of the capital return story. The company is also reducing its overall share count, which helps boost earnings per share over time. During fiscal 2025, Domino’s spent about $355 million repurchasing its shares. And even after aggressively repurchasing its stock, the company exited the year with nearly $460 million in authorized share repurchases. This gives management plenty of firepower to opportunistically buy back stock while shares are trading at a discount.