Papa John's (PZZA) Stock Forecast & Price Target

Papa John's International has demonstrated solid financial performance, highlighted by a year-over-year improvement in North America commissary EBITDA margin by 100 basis points to 7.4%, driven by a 3% increase in total pizzas sold. The company's international comparable sales grew by 7.1%, exceeding both internal and market expectations, and benefitted from the successful transformation of its UK operations. Additionally, the positive trends in customer loyalty engagement and sequential traffic gains indicate a strengthening brand perception that supports optimism for future growth and unit development in the second half of 2025.

Papa John's International has experienced a decline in its domestic company-owned restaurant EBITDA margin, which fell approximately 20 basis points year-over-year to 2.4%, primarily due to labor inflation and lower transaction volumes. The company has revised its FY25 systemwide sales, North America comp, and adjusted EBITDA guidance downwards, indicating slower-than-expected performance in the U.S. Additionally, franchisee profitability concerns may hinder unit growth, while external economic factors such as recessions and low consumer confidence could further exacerbate operational volatility and contribute to declining sales.