Shares of Domino's Pizza Inc
The latest news of Weiner stepping down as CEO follows a series of disappointing announcements by the company, according to BTIG.
The Domino's Pizza Analyst: Analyst Peter Saleh maintained a Buy rating, while cutting the price target from $450 to $425.
The Domino's Pizza Thesis: Weiner's retirement is disappointing given the company's success under his leadership, his role in the U.S. business turnaround and his short tenure of just over four years as CEO, Saleh said in the note.
"We believe Russell was instrumental in the launch of the Mix and Match platform, the focus on carryout to differentiate the brand, and much of the advertising strategy following the financial crisis," the analyst wrote.
He added that this news follows disappointing first-quarter earnings and a softer sales outlook from Domino's Pizza.
COO and President of Domino US Business Joe Jordan would become the company's CEO on Oct. 1. Jordan would also join the board of directors. This comes at a time when Domino's same-store sales are growing below the 3% long-term target, the analyst stated.
Weiner would take over as the executive chairman of the board of directors, following the departure of David Brandon after being with Domino's for 28 years, Saleh further mentioned.
Domino's stock could remain under pressure in the near-term as investors respond to the management changes and wait for the company to recapture momentum, the analyst said. Meanwhile, rival Yum! Brands Inc
"While we recognize the optics, with a CEO transition occurring just as sales have softened, we continue to believe in the market share gains driven by best-in-class unit economics, strong franchise system, an unmatched value platform, and a substantially larger advertising budget than peers," he further wrote.
DPZ Price Action: Shares of Domino's Pizza had declined by 2.93% to $286.48 at the time of publication on Tuesday.
