Pizza Pizza Royalty Corporation's unique royalty-based model offers high margins, low costs, and resilience against inflation and operational risks. Despite reliance on Canadian sales and limited operational control, steady royalty income and low capital requirements support stable cash flow and dividends. Valuation remains attractive with an 18% upside potential, and technical indicators show continued bullish momentum, though a short-term dip is possible.
Pizza Pizza's Q1 saw a turnaround with positive same-store sales, driven by menu innovation and effective marketing rather than heavy discounting. The asset-light royalty model ensures steady, predictable cash flow, supporting a high dividend payout even during challenging quarters. Recent promotions and new product launches boosted both traffic and average check, outpacing other Canadian QSR pizza chains.
Pizza Pizza Royalty Corp. (OTCPK:PZRIF) Q1 2025 Earnings Conference Call May 7, 2025 5:00 PM ET Company Participants Paul Goddard - Chief Executive Officer Christine D'Sylva - Chief Financial Officer Conference Call Participants Derek Lessard - TD Cowen Operator Ladies and gentlemen, thank you for standing by and welcome to the Pizza Pizza Royalty Corp.'s Earnings Call for the First Quarter of 2025. [Operator Instructions] As a reminder, this conference is being recorded on May 7, 2025.
PZA:CA offers a royalty structure, with unit holders receiving distributions tied to sales of Pizza Pizza and Pizza 73 chain in Canada. Canadian patriotism could boost local retailers like Pizza Pizza, positioning them to gain market share from competing American-based pizza restaurants. Q1 results were okay, but nothing to write home about. Even if future quarters show stronger growth, I don't think management will increase their payout ratio beyond 7.75 cents this year.
Pizza Pizza Royalty's share price increased 10% in the past year, outperforming the TSX, despite flat to slightly down business results and modest growth expectations. FY 2024 results showed a 3% decrease in same-store sales and a 2.7% drop in adjusted EPS, with a 117% payout ratio. Investors anticipated a boost from Canadian patriotism, but Q1 results didn't validate this, showing limited revenue growth.
Pizza Pizza Royalty Corp. (OTCPK:PZRIF) Q4 2024 Earnings Conference Call March 31, 2025 5:00 PM ET Company Participants Paul Goddard – Chief Executive Officer Christine D'Sylva – Chief Financial Officer Conference Call Participants Derek Lessard – TD Cowen Operator Ladies and gentlemen, thank you for standing by, and welcome to the Pizza Pizza Royalty Corp.'s Earnings Call for the Fourth Quarter of 2024. During the presentation, all participants will be in a listen-only mode.
Pizza Pizza Royalty Corp offers an investment opportunity due to its strong Canadian brand and potential sales boost from national pride. The Royalty's distribution payout ratio recently exceeded 100%, causing the unit price to struggle. I believe Pizza Pizza will benefit from Canadians' preference for local brands, ensuring stable distributions and growth. I have a $15 price target.
Pizza Pizza Royalty Corp.'s earnings are driven by restaurant count and comparable sales growth, with recent declines mitigated by new location openings. Despite a 5.3% drop in comparable sales, Pizza Pizza Royalty increased dividends by using cash reserves, achieving a 3.3% year-over-year dividend growth. Valuation using the Gordon Model suggests a 32.2% margin of safety for passive income portfolios.
Pizza Pizza Royalty Corp. (OTCPK:PZRIF) Q3 2024 Earnings Call November 4, 2024 5:30 PM ET Company Participants Christine D'Sylva - Chief Financial Officer Paul Goddard - Chief Executive Officer Conference Call Participants Derek Lessard - TD Securities Operator Good afternoon, ladies and gentlemen and welcome to the Pizza Pizza Royalty Corp. Third Quarter Earnings Call. [Operator Instructions] This call is being recorded on November 4, 2024.
Pizza Pizza Royalty Corp. was previously rated a hold with a "buy under" $13.00. Q2-2024 results showed a 3.9% drop in same-store sales, driven by a 5.1% decline in Pizza Pizza brand sales. The payout ratio was at 109%.
Pizza Pizza Royalty offers a compelling investment opportunity with a strong royalty model, consistent growth, and attractive valuations. The company's track record includes consistent restaurant count growth, dividend increases, and plans for international expansion in Mexico. Despite a weak consumer environment, Pizza Pizza has shown strong results with positive same-store sales growth and successful menu innovations.