Although it has given back the majority of its early gains, the Domino's Pizza Enterprises Ltd. (ASX: DMP) share price is pushing higher in afternoon trade.
At one stage the pizza chain operator's shares were up 3% to $47.72. At the time of writing they are 0.8% higher to $46.72.
Why did its shares climb higher?
This morning Goldman Sachs released an upbeat broker note on Domino's following yesterday's announcement relating to its Halo Pizza acquisition in Germany.
That announcement revealed that the company had successfully completed the €32 million 170 store Hallo Pizza chain acquisition which was announced in October of last year.
Although the acquisition was expected to close early in 2018, this appears to have happened sooner than Goldman Sachs had anticipated.
As a result of this and minor revisions to its foreign exchange forecasts, the broker has lifted the price target it has on Domino's shares.
Goldman's new price target is $49.50, approximately 6% higher than the current share price. The broker has retained its neutral rating.
Should you invest?
I think that Domino's is a great option for buy and hold investors due to its international expansion and the store growth that this will bring.
The pizza chain operator is targeting 4,650 stores by 2025, more than double its store count at the end of FY 2017. Further, it expects to greatly increase its margins during this time as well, potentially leading to strong earnings growth for the foreseeable future.
In light of this, I would suggest investors consider investments in Domino's and industry peer Collins Foods Ltd (ASX: CKF) this year.
Especially as I feel Goldman Sachs' price target is a little on the conservative side. As a contrast, Morgan Stanley and UBS both have buy ratings on its shares at the moment with price targets of $53.00 and $60.00, respectively.
