Dominoes (ASX: DMP) $54.37 DMP -23.81%: Whacked today and...

Dominoes (ASX: DMP) $54.37
DMP -23.81%: Whacked today and rightly so after a result that was a big miss to consensus while market positioning had clearly become more positive on the stock with the share price up ~50% from its recent lows. Fund manager’s drank the DMP cool-aid with gusto as Mr Meji said that while things were tough, they were turning around – which now seems a stretch, in the short term at least. For the 1H, same-store sales growth was -0.55%, online sales went backwards (-4.5%), and revenue declined (-4.3%). With a weaker top line and rising cost pressures, earnings fell by more with underlying EBIT of $113.9m down 21% YoY while net profit was around ~16% below consensus. A stock on ~30x earnings that is not growing is a stock that won’t be on 30x for long, and that was certainly the case with DMP today. We have no interest in trying to catch this falling knife – downgrades to come.