• RBC Capital adjusts Domino's Pizza (NASDAQ:DPZ) rating to "Sector Perform" with a revised price target of $450.
• Domino's reports strong third-quarter performance, with a potential for significant stock price growth.
• The company focuses on aggressive capital returns through dividends and share buybacks, amidst challenges of high debt levels.

On October 15, 2025, RBC Capital adjusted its rating for Domino's Pizza (NASDAQ: DPZ) to "Sector Perform," maintaining a "hold" action. At the time, the stock price was around $424.15. RBC Capital also revised its price target for Domino's, lowering it from $500 to $450. Despite this, Domino's has shown strong performance in the third quarter, positively impacting its stock price.

Domino's Pizza has exceeded investor expectations with its third-quarter report, affirming its growth outlook and valuation. The company has delivered a robust performance, with a potential to increase its stock price by 20% this year and possibly by 100% or more in the long term. This performance has led to an upgrade of its stock rating from 'Sell' to 'Hold', as highlighted by MarketBeat.

The company is focusing on aggressive capital returns, including a dividend distribution that annualizes to 1.7%. Domino's is also engaging in share buybacks, reducing the share count by an average of 2.6% over the past year. These buybacks are expected to continue robustly in the fourth fiscal quarter and the following fiscal year, supporting the stock's valuation and growth outlook.

Domino's Pizza was trading at approximately 24 times its current-year earnings forecast before the report, indicating significant growth expectations. The stock is currently trading at a 23x forward price-to-free-cash-flow valuation. Despite these positive developments, Domino's faces challenges with high debt levels, which long-term investors should monitor closely.

Domino's has reported a 5.2% increase in same-store U.S. sales, driven by the success of its Best Deals Ever program. However, the company remains cautious, projecting a 3% growth in comparable sales for the year due to potential pressures from the challenging macroeconomic environment. The current stock price of DPZ is $414.33, reflecting a decrease of approximately 2.33% with a change of $9.90.