- Same-store sales jumped 5.3% in North America and 2.3% internationally on a surge in demand for food delivery
- Papa John’s is withdrawing 2020 guidance due to the uncertainty
- Shares of the company have surged more than 7% higher today
Shares of Papa John’s (NASDAQ:PZZA) are trading nearly 7% higher today, after the company reported that the same-store sales will rise 5.3% in Q1 in North America on the back of the booming fool delivery services.
Fundamental analysis: Sales rose, forward guidance withdrawn
Papa John’s, the fourth largest pizza delivery restaurant chain in the United States, said that the same-store sales in North America will rise 5.3%, comfortably beating the company’s earlier projections of 1.6%. Internationally, sales jumped 2.3%, again higher than the 1.6% projected earlier, for the period ending March 29.
“First in Asia, then in Europe, and now in North and South America, we have seen the COVID-19 pandemic impact our business differently, depending on the restrictions enacted by governments. In some international markets this has resulted in temporary closures, but in most markets, including North America, we are nearly fully operational,” said Rob Lynch, President & CEO.
Papa John’s is withdrawing the forward-looking guidance for 2020 due to the COVID-19 uncertainty, while the full first-quarter results will be published in the early May, the company anticipates.
“Although March sales in North America were negatively impacted by the cancellation of large gatherings, including major sporting events, our international and domestic businesses have performed well, as customers and communities rely on us and others in the food delivery industry,” added Lynch.
The pizza chain also said that approximately 350 of its shops are closed worldwide, out of 2,100 it operates globally, including 15 locations in China.
Technical analysis: Stock holding up really well
Unlike the vast majority of the stock market, shares of Papa John’s are holding up really well given the overall situation. Following the creation of a 7-year low below the $30 handle last week, the stock price has rebounded nearly 100% from these lows.
As a result, the buyers are now testing the key short-term resistance, consisting of three different layers of resistance – 100-DMA at $51.57, the horizontal resistance, and 61.8% Fibonacci retracement near the $54 handle.
A close above this resistance block would pave the way for a trip above $60, where the 200-DMA is located, while the 30-month high sits at $70.17.
Shares of Papa John’s are trading more than 7% higher today after the pizza chain said its same-store sales rose 5.3% in North America, and 2.3% internationally, on the back of a surge in demand for food delivery. Moreover, the company is withdrawing 2020 guidance due to the uncertainty amid the COVID-19 outbreak.