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Why Papa John's (PZZA) Is Up 6.4% After Major Franchise Deal to Expand Northeast Presence

Simply Wall St·11/27/2025 23:27:33
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  • Papa John’s International recently announced it has transferred ownership of 85 restaurants in the Washington, D.C. and Baltimore areas to Pie Investments, a leading franchisee, with both parties also planning to open 52 new locations by 2030 in key Northeast and Mid-Atlantic markets.
  • This move marks a significant milestone in Papa John’s efforts to expand its footprint by partnering with large-scale, growth-focused franchise operators to accelerate market presence.
  • We'll examine how this major refranchising agreement, designed to accelerate growth with trusted partners, could impact Papa John's investment outlook.

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Papa John's International Investment Narrative Recap

To be a shareholder in Papa John’s International, you need to believe in the company’s ability to drive efficient expansion by partnering with focused franchisees, advancing menu innovation, and optimizing operational scale. The recent refranchising agreement with Pie Investments directly supports these efforts by shifting more stores to growth-oriented operators, which aligns with the primary short-term catalyst of improved margin efficiency, though it does not materially reduce the main risk, the pressure on North America comparable sales and net margins due to value-focused pricing.

One of the most relevant recent announcements is the leadership change, with Ravi Thanawala promoted to CFO and President, North America. His expanded role is significant as the management team now oversees both financial discipline and operational development, directly intersecting with the company’s current push for franchise-led growth and network efficiency to support near-term margin improvement.

However, in contrast with these growth moves, investors should be aware of ongoing challenges with North America comparable sales and declining net margins, especially in an environment where...

Read the full narrative on Papa John's International (it's free!)

Papa John's International's narrative projects $2.2 billion in revenue and $67.4 million in earnings by 2028. This requires a 1.4% yearly revenue growth and a $7.3 million earnings decrease from current earnings of $74.7 million.

Uncover how Papa John's International's forecasts yield a $49.30 fair value, a 18% upside to its current price.

Exploring Other Perspectives

PZZA Community Fair Values as at Nov 2025
PZZA Community Fair Values as at Nov 2025

Community estimates for Papa John’s fair value range from US$27.62 to US$49.30 across three distinct Simply Wall St Community perspectives. With ongoing concerns about net margin pressure in North America, these wide-ranging views show just how varied expectations for Papa John’s future performance can be.

Explore 3 other fair value estimates on Papa John's International - why the stock might be worth as much as 18% more than the current price!

Build Your Own Papa John's International Narrative

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.