Domino's Pizza given boost by Berenberg upgrade

Domino’s Pizza’s shares jumped on Thursday after Berenberg raised its rating to ‘buy’ from ‘hold’ and raised its target price to 1200p from 900p.

The upgrade comes a day following news the companies that own Domino’s in the UK and Australia have set up a joint venture to buy Germany’s biggest pizza chain Joey’s Pizza.

Sydney-listed Domino's Pizza Enterprises will own two thirds of the joint venture while the remainder will be owned by London-listed Domino's Pizza Group, which already has operations in Germany.

“Domino’s Pizza reported upbeat third quarter numbers back in October, with like-for-like trading 11.8% ahead year-on-year in the UK versus 10.3% at the first half,” Berenberg analysts said.

“We update our numbers to take account of that strong trading (accounting for c8% of our upgraded numbers for 2015E), in addition to the inclusion of the recent JV announcement in Germany.”

Shares rose 4.95% to 1,039p at 1525 GMT.