The Domino's Pizza Enterprises Ltd (ASX: DMP) share price has had a positive start to the week and is up 2% to $46.87 at the time of writing.
This gain means that the pizza chain operator's shares have now gained over 21% during the last six weeks and 15% since the start of the year.
Is it too late to invest?
According to a note out of the Macquarie Group Ltd (ASX: MQG) equities desk last month, it isn't too late to pick up Domino's shares.
Although the broker reduced its price target on the company's shares to $54.00 from $61.00, it maintained its outperform rating.
Its analysts believe that concerns over the profitability of Australian franchises are unwarranted and that the market is overlooking the potential for the company to replicate its local success in the massive European market.
In addition to this, Macquarie believes that the re-rating of its shares over the last 12 months means that they are fairly priced for its current growth profile.
The note reveals that Macquarie expects Domino's to achieve earnings per share of $1.78 in FY 2019 and then $2.07 in FY 2020. This implies year on year growth of approximately 27% and then 16%.
Should you invest?
I agree with Macquarie on Domino's, especially with its shares now trading at 26x estimated FY 2019 earnings.
I think this is good value for a company with such promising long-term growth plans. Last year management reaffirmed its aim of growing its store network to 4,650 stores by 2025. This compares to 2,393 stores at the end of FY 2018.
All in all, I think this makes it a good long-term option for patient investors along with fellow quick service restaurant operator Collins Foods Ltd (ASX: CKF) and fuel retailer Caltex Australia Limited (ASX: CTX) due to its convenience business expansion plans.
