Shares in Domino's Pizza Group PLC (LSE:DOM), the UK and Ireland pizza delivery and collection operator, fell 5% after a leading investment bank downgraded the stock
Deutsche Bank moved from 'hold' to 'sell' and reduced its target price by 26% to 175p, citing persistent weakness in like-for-like sales and a lack of confidence in the company's recovery plan.
Analyst Richard Stuber said like-for-like (LFL) sales, which measure growth at established outlets, had averaged just 0.4% over the past two years, with volumes falling in the low to mid-single digits.
Stuber said two initiatives that were expected to drive a turnaround had so far failed to deliver.
The company's push on collection orders, which represent around 35% of total volume and were seen as a growth opportunity due to lower price points and an attractive value proposition, has produced three consecutive quarters of declining collection volumes.
A loyalty programme, first explored in 2022 and in trial since August 2024, has yet to make any meaningful contribution to sales, and a full national rollout is not expected until late 2026 or early 2027.
Deutsche also cited significant management instability as a further obstacle to recovery, with both the chief executive and chief financial officer having departed the company.
It said the combination of leadership disruption and unproven self-help measures meant there was little prospect of major new initiatives emerging to reaccelerate sales growth in the near term.
The shares fell 5.4% to 180.7p.