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Tuesday July 16, 2024



Domino's Pizza Serves Up Earnings

Domino’s Pizza, Inc. (DPZ) released its latest quarterly earnings on Monday, April 29. The restaurant chain’s stock rose more than 2% following the report’s release.

Revenue came in at $1.08 billion during the first quarter, in line with analysts’ expectations. This was up from revenue of $1.02 billion during the same quarter last year.

“Our first quarter results demonstrated that our Hungry for MORE strategy is off to a strong start: delivering MORE sales, MORE stores, and MORE profits,” said Domino’s CEO, Russell Weiner. “The Renowned Value we created through our new and improved Domino’s Rewards loyalty program drove outsized comp performance, which flowed through to the bottom line with double-digit profit growth. We are laser focused on driving franchisee profitability and store growth, which will fuel the Company’s ability to win and create meaningful long-term value for our shareholders.”

Domino’s reported net income of $125.82 million or $3.58 per adjusted share. This was up from $104.77 million in net income or $2.93 per adjusted share last year at this time.

The pizza company primarily credited its net income increase to higher income from its operations. The company’s domestic same store sales increased by 5.6% from the same quarter last year. Internationally, same store sales were increased slightly by 0.9% from the year prior. Additionally, the company reported a net increase of 20 stores in the U.S. and 144 new stores abroad, ending the quarter with 20,755 total stores globally. Domino’s declared a dividend of $1.51 per share of common stock, payable on June 28, 2024, to the stockholders of record on June 14, 2024.

Domino’s Pizza, Inc. (DPZ) shares ended the week at $514.33, down 3% for the week.

3M Releases Earnings Report

3M (MMM) released its first quarter earnings report on Tuesday, April 30. 3M posted better-than-expected sales for the quarter, resulting in its shares rising by 5%.

Net sales for the quarter came in at $8.00 billion. This was down from $8.03 billion during the same quarter last year, ahead of analysts’ estimated quarterly sales of $7.63 billion.

“We delivered results that were better than our expectations as we returned to organic growth and achieved double digit adjusted earnings growth," said 3M CEO, Mike Roman. “We improved performance in our businesses through strong operational execution, completed the spin-off of Solventum, and finalized two major legal settlements. The progress we have made in executing our strategic priorities, positions the company for long-term shareholder value creation as Bill Brown assumes the role of 3M CEO.”

3M posted net income of $928 million or $1.67 per adjusted share for the quarter. Last year at this time, the company posted net income of $976 million or $1.76 per adjusted share.

The company’s Safety and Industrial segment reported sales of $2.73 billion during the quarter, down from $2.78 billion during the same period the year prior. Sales in the Transportation and Electronics segment reached $2.10 billion, up from $2.05 billion one year ago. 3M’s Health Care segment posted sales of $2.02 billion, an increase from sales of $2.01 billion in 2023. The Consumer segment posted sales of $1.14 billion, down from $1.19 billion in the year prior. 3M initiated their full-year 2024 earnings outlook, incorporating Solventum as a discontinued operation, and expects sales growth ranging from negative 0.25% to growth of 1.75%.

3M (MMM) shares ended the week at $97.15, up 6% for the week.

Coca-Cola Reports Earnings

Coca-Cola Company (KO) released its first quarter earnings report on Tuesday, April 30. Although the soft drink company reported increased revenue that exceeded expectations, its shares rose less than 1% following the release of the report.

Coca-Cola posted net revenue of $11.30 billion for the quarter. This is up 3% from $10.98 billion in revenue reported at the same time last year and above Wall Street’s expectation of $11.01 billion.

“We are encouraged by our start to 2024, delivering another quarter of volume, topline and earnings growth amidst a dynamic backdrop,” said Coca-Cola CEO, James Quincey. “We believe our global system is primed for sustained success, thanks to the right strategies, clear alignment, a powerful portfolio and strong execution.”

Coca-Cola reported net income of $3.18 billion for the quarter. This was up 2% from $3.11 billion in the same quarter last year.

The iconic Atlanta-based beverage company reported growth of 1% in their consolidated unit case volume for the first quarter attributable to growth in developing and emerging markets in Brazil, the Philippines and Nigeria. The performance of the company’s Trademark Coca-Cola segment and sparkling soft drinks segment both grew 2% for the quarter. The company’s water, sports, coffee and tea segment decreased by 2%. The Coca-Cola Zero Sugar segment grew by 6% for the quarter. For fiscal 2024, the company expects to deliver organic revenue growth of 8% to 9%.

Coca-Cola Company (KO) shares closed at $62.17, relatively unchanged for the week.

The Dow started the week at 38,282 and closed at 38,676 on 5/3. The S&P 500 started the week at 5,114 and closed at 5,128. The NASDAQ started the week at 16,007 and closed at 16,156.


Treasury Yields Vary

U.S. Treasury yields varied throughout the week as investors digested the Federal Reserve's most recent monetary policy update following this week’s meeting. Yields continued to rise on Friday as the latest jobs report and unemployment data showed the labor market remains tight.

On Wednesday, the Federal Reserve released its post-meeting statement maintaining the federal funds target range at current levels and providing no indication of impending rate reductions. Federal Reserve officials held the key federal funds rate between 5.25% and 5.50% for the sixth straight meeting. The Federal Reserve further indicated a need for increased confidence in the progress of inflation towards its 2% goal before considering rate cuts.

“In recent months, inflation has shown a lack of further progress toward our 2% objective,” said Federal Reserve Chairman, Jerome Powell. “I think it is unlikely that the next policy rate move will be a hike.”

The benchmark 10-year Treasury note yield opened the week of April 29 at 4.67% and traded as high as 4.65% on Thursday. The 30-year Treasury bond opened the week at 4.78% and traded as high as 4.79% on Thursday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment were unchanged at 208,000 for the week ended April 27. Continuing unemployment claims were also unchanged at 1.77 million. On Friday, the April jobs report was released. New jobs reached 175,000 for the month of April, missing estimates of 240,000. Unemployment rose to 3.9%, above estimates of 3.8%.

“The labor market remains tight," said senior vice president at Challenger, Gray & Christmas, Andrew Challenger. “But as labor costs continue to rise, companies will be slower to hire, and we expect further cuts will be needed.”

The 10-year Treasury note yield finished the week of 4/29 at 4.52%, while the 30-year Treasury note yield finished the week at 4.67%.


Mortgage Rates Climb Again

Freddie Mac released its latest Primary Mortgage Market Survey on Thursday, May 2. The survey showed mortgage rates rising for the fifth straight week.

This week, the 30-year fixed rate mortgage averaged 7.22%, up from last week’s average of 7.17%. Last year at this time, the 30-year fixed rate mortgage averaged 6.39%.

The 15-year fixed rate mortgage averaged 6.47% this week, up from 6.44% last week. During the same week last year, the 15-year fixed rate mortgage averaged 5.76%.

“The 30-year fixed-rate mortgage increased for the fifth consecutive week as we enter the heart of Spring Homebuying Season,” said Freddie Mac’s Chief Economist, Sam Khater. “On average, more than one-third of home sales for the entire year occur between March and June. With two months left of this historically busy period, potential homebuyers will likely not see relief from rising rates anytime soon. However, many seem to have acclimated to these higher rates, as demonstrated by the recently released pending home sales data coming in at the highest level in a year.”

Based on published national averages, the savings rate was 0.46% as of 04/15. The one-year CD averaged 1.81%.

Editor’s Note: The publicly available financial information is offered as a helpful and informative service to our friends. This article is not an endorsement of any company, product or service.

Published May 3, 2024
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