Summary

  • Brokerage Wedblush raised Papa John’s from ‘neutral’ to ‘outperform’ rating on Friday, September 1, 2023.
  • Papa John’s reported a 1% year-on-year (yoy) drop in comparable sales in Q2 2023, due to slower sales growth in the company’s North America franchised restaurant.
  • PZZA has a mean recommendation rating of 1.9 and a consensus mean price target of US$93.73.

Restaurant chain operator Papa John’s International (NASDAQ: PZZA) received a rating upgrade from broker Wedblush. The brokerage upgraded PZZA to ‘outperform’ from ‘neutral’ and also raised the price target on the stock.

As per EODHD/Others, PZZA has an overall mean recommendation rating of 1.9 on a scale of one to five. Here, one stands for a ‘strong buy’ rating and five is a ‘strong self’ rating.

PZZA Price Chart; Image Source: PZZA EODHD/Others

Papa John’s share price went up 3.4% to US$78.28 post the rating upgrade from the broker. The stock closed at US$ 76.55 on September 5, 2023. PZZA hit its 52-week high of US$97.78 on February 16, 2023.

Wedblush expects improved sales for Papa John’s

Wedblush believes that Papa John’s may see an improvement in same store sales (SSS) expansion trajectory over the near- to medium-term, which provides prospective for margin expansion. In lieu of these expectations, Wedblush raised its price target on PZZA from US$80 to US$95.

For the second quarter of 2023, Papa John’s reported a 1% drop in comparable sales from Q2 2022 due to slower sales growth in the company’s North America franchised restaurant. PZZA’s total revenue was also lower by US$8.13 million at US$514.53 million in the June 223 quarter.

Papa John’s paid its shareholders cash dividends of US$0.43 per common share in Q2 2023. For Q3, the company paid a dividend of US$0.46 per common share, representing a 10% increase from the previous dividend.

Brokers see a 21% upside in PZZA share price

As per EODHD/Others data, PZZA has a consensus mean price target of US$93.73. This is an upside potential of 22.39% on the PZZA’s closing price on Tuesday.

Papa John’s also received a rating upgrade from brokers BTIG and Stifel Nicolaus to ‘buy’ on August 3, 2023. Meanwhile, Oppenheimer & Co also raised its rating on PZZA to ‘outperform’ on August 3, 2023.

Piper Sandler raised its price target on PZZA to US$80 on August 3, 2023, while maintaining a ‘neutral’ rating.

Image source: ©2023 Krish Capital Pty Ltd.; Data source: EODHD/Others

A total of 17 analysts have covered the stock on EODHD/Others, among which seven state that PZZA is a ‘strong buy’ and five believe it is a ‘buy’ and four analysts have given it a ‘hold’ rating. One analyst believes PZZA is a ‘sell’ and none of the analysts have given it a ‘strong buy’ rating.