Domino's Pizza stays a Buy with growth abroad offsetting US challenges, despite mixed Q2 results.

Domino's Pizza reported mixed Q2 results, with international store growth balancing out weaker US consumer demand and a miss on earnings per share. Free cash flow dropped 5.5% due to increased capital expenditures. Management expects operating income to grow mid- to high-single digits by 2026 but plans to slow US store openings amid economic headwinds. The combined dividend and buyback yield is near 6.65%, supported by a stronger balance sheet and a margin of safety despite ongoing inflation and consumer pressures, maintaining its Buy rating based on international expansion and solid fundamentals.