Papa John’s International, Inc. (NASDAQ:PZZA) is one of the best restaurant stocks to buy now. Cautious Analyst Sentiment on Papa John’s (PZZA) As Refranchising and Cost Reductions Drive Strategy As of January 6, 2026, roughly 40% of analysts are bullish on Papa John’s International, Inc. (NASDAQ:PZZA) with a median price target of $48.00, amid the company’s strategic and expansion initiatives. The price target translates into an upside potential of 20.40%. The most recent analyst update came from Jeffer ...

Core Viewpoint - Krispy Kreme has agreed to sell its Japanese operations to Unison Capital for approximately $65 million, marking its first international refranchising agreement since initiating a turnaround plan in August 2023 [1][2]. Group 1: Transaction Details - The deal is expected to be completed in the first quarter of 2026 and involves Krispy Kreme's 89 outlets in Japan and around 300 fresh delivery points in major urban areas [1]. - The cash proceeds from the sale will be used to reduce the company's debt [2]. Group 2: Strategic Importance - The CEO of Krispy Kreme emphasized that this transaction represents meaningful progress in their turnaround strategy, which includes refranchising as a key component [2]. - The sale is seen as a significant step in advancing Krispy Kreme's refranchising initiative, aimed at enhancing financial flexibility [3]. Group 3: Buyer Profile - Unison Capital, founded in 1998, specializes in investments in consumer, healthcare, and B2B services, and has raised approximately $5 billion through various investment vehicles in Japan and South Korea [4]. - The firm has a diverse portfolio that includes food and beverage operators, indicating its capability to manage Krispy Kreme's operations effectively in Japan [4]. Group 4: Future Outlook - Unison Capital's co-founder expressed excitement about taking over Krispy Kreme's operations, highlighting the brand's iconic status and the intention to build on its legacy in Japan [5]. - The partnership is expected to align with Krispy Kreme's commitment to excellence and growth in the Japanese market [6].

Core Insights - The Coca-Cola Company is transitioning to a brand-led franchise system by refranchising its bottling operations globally, which is expected to enhance its overall margin profile and profitability [1][4][9] Financial Performance - In Q3 2025, Coca-Cola's comparable operating margin increased by 115 basis points, while the comparable currency-neutral operating margin rose by 270 basis points, indicating effective cost and pricing management amid macroeconomic challenges [2][9] - The Zacks Consensus Estimate for Coca-Cola's earnings per share (EPS) for 2025 and 2026 suggests year-over-year growth of 3.5% and 8%, respectively, with stable estimates over the past 30 days [11] Strategic Initiatives - The selection of strategic franchise partners for bottling operations has led to improved operational efficiency and investment, driving system-wide growth and profitability [3] - Coca-Cola's focus on productivity, cost-control initiatives, product innovations, and supply-chain optimization is expected to further elevate margins and strengthen profitability [4] Competitive Landscape - Coca-Cola faces competition from PepsiCo and Monster Beverage, both of which are also focusing on productivity and operational efficiency to drive growth [5][6][7] Stock Performance and Valuation - Coca-Cola's shares have increased by 12% over the past year, outperforming the industry growth of 6.7% [8] - The company is currently trading at a forward price-to-earnings ratio of 22.10X, compared to the industry average of 18.42X [10]

Core Insights - Krispy Kreme reported Q3 CY2025 revenue of $375.3 million, missing analyst expectations of $378.2 million, reflecting a 1.2% year-on-year decline [6] - The company achieved a non-GAAP profit of $0.01 per share, significantly exceeding analysts' consensus estimates of -$0.05 [6] - Adjusted EBITDA was $40.6 million, beating estimates of $28.33 million, with a margin of 10.8% [6] Financial Performance - Revenue: $375.3 million vs analyst estimates of $378.2 million (1.2% year-on-year decline, 0.8% miss) [6] - Adjusted EPS: $0.01 vs analyst estimates of -$0.05 (significant beat) [6] - Adjusted EBITDA: $40.6 million vs analyst estimates of $28.33 million (10.8% margin, 43.3% beat) [6] - Operating Margin: -1.9%, improved from -4.2% in the same quarter last year [6] - Market Capitalization: $669.6 million [6] Strategic Initiatives - The company exited around 600 unprofitable U.S. locations and ended its partnership with McDonald's, focusing on high-traffic, high-margin locations [7] - Average weekly sales per door increased by 18% sequentially due to these strategic changes [7] - Management is pursuing a refranchising strategy in select international markets to accelerate unit growth and reduce capital intensity [7] Operational Efficiency - Over half of U.S. logistics are now managed by third-party partners, expected to fully roll out in 2026, leading to more predictable and potentially lower delivery costs [7] - Operational changes included optimizing production processes and improving labor management [7] International Expansion - Markets like Japan and Mexico showed organic growth, with new openings in Spain and upcoming entries into Uzbekistan and Brazil [8] - Collaboration with KFC in the UAE has expanded to over 200 outlets, demonstrating the scalability of the hub-and-spoke delivery model [8] Digital and Product Innovation - Limited-time offerings and a refreshed core doughnut menu contributed to higher-margin growth, alongside a 17% increase in U.S. digital sales [8] - Digital sales now account for over 20% of U.S. retail sales, highlighting its strategic importance [8]

Financial Data and Key Metrics Changes - Adjusted EBITDA grew 17% year over year to $40.6 million, more than double the second quarter [15][17] - Net revenue for the quarter was $375.3 million, reflecting a 1.2% decline compared to last year, primarily due to the sale of a majority stake in Insomnia Cookies [17][18] - Free cash flow was positive at $15.5 million, with operating cash flow of $42.3 million during the third quarter [20][21] Business Line Data and Key Metrics Changes - U.S. segment organic revenue declined 2.2%, impacted by the exit of approximately 600 unprofitable doors [18][19] - International markets saw organic revenue growth of 6.2%, driven by Canada, Japan, and Mexico [19] - Market development segment organic revenue declined 5.3%, with adjusted EBITDA at $12 million, up 930 basis points year-over-year [20] Market Data and Key Metrics Changes - The U.S. market experienced a sequential increase in average weekly sales to $617 per door, an 18% increase due to door optimization [19] - International segment adjusted EBITDA increased by $0.4 million, or 1.7%, to $23.2 million, marking the first year-over-year growth in four quarters [19] Company Strategy and Development Direction - The company is focused on refranchising, improving returns on capital, expanding margins, and driving sustainable U.S. growth [6][23] - Plans to restructure the joint venture in the Western U.S. to reduce ownership to a minority stake, aiming to use proceeds for debt reduction [6][7] - Emphasis on leveraging existing assets and reducing capital intensity, with a significant reduction in CapEx spending planned for 2025 [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the turnaround plan, highlighting early progress in reducing net leverage and improving profitability [15][22] - The company is mindful of continued consumer softness but remains focused on deleveraging the balance sheet and capital-light franchise model [21][22] - Positive consumer response to specialty donut campaigns and a successful Halloween campaign reinforces confidence in long-term growth [34][46] Other Important Information - The company plans to fully outsource U.S. delivery by 2026, which is expected to provide more predictable costs and operational improvements [38] - A refresh of the everyday donut menu was announced, responding to consumer demand for variety while maintaining focus on core products [42][43] Q&A Session Summary Question: Continued strong trends in international markets for Q4 - Management confirmed ongoing strong momentum in international markets, particularly in Mexico and Japan, with growth expected to continue [26][27] Question: Learnings from U.S. expansion for international markets - Management highlighted the importance of the hub-and-spoke model and the learnings from U.S. expansion as they enter new international markets [28][29] Question: U.S. demand environment in Q3 - Management noted that exiting underperforming doors contributed to a small revenue decline but significantly improved EBITDA and cash flow, with a focus on high-volume, profitable doors [32][33] Question: Cost expectations and Q4 EBITDA outlook - Management expects sequential improvement in EBITDA for Q4 and positive cash flow, although specific guidance was not provided [35][55] Question: Implications of fully outsourcing U.S. delivery - Management indicated that outsourcing will lead to more predictable costs and operational improvements, reducing exposure to casualty losses [37][38] Question: Expanded core menu lineup - The menu refresh was prompted by consumer demand for variety, balancing choice with operational efficiency [40][42] Question: Competition and consumer spending trends - Management emphasized the strength of the brand and its unique position in the market, focusing on delivering exceptional donut experiences [45][46] Question: Changes in distribution network strategy - Management is focused on expanding convenience and access to the brand in high-traffic locations, having exited low-traffic doors [48][49]

Core Insights - The Coca-Cola Company is transitioning into a total beverage company with a resilient strategy that combines marketing, innovation, and revenue growth management [1] - Coca-Cola and Gutsche Family Investments have agreed to sell a 75% controlling stake in Coca-Cola Beverages Africa Pty. Ltd. to Coca-Cola HBC AG [2][9] - The total equity value of the transaction for 100% of CCBA is estimated at US$3.4 billion, with completion expected by the end of 2026 [3][4] Transaction Details - Coca-Cola will sell 41.52% of its 66.52% interest in CCBA to Coca-Cola HBC, which will also acquire 33.48% held by Gutsche Family Investments [2][4] - An option agreement allows Coca-Cola HBC to acquire the remaining 25% of CCBA within six years of closing [4][9] - Following the acquisition, Coca-Cola HBC will represent two-thirds of Africa's Coca-Cola system volume, covering over half of the continent's population [5][9] Strategic Initiatives - Coca-Cola is enhancing its digital capabilities to improve marketing, sales, and distribution, aiming to capture online demand for at-home consumption [6] - The company is implementing a refreshed marketing model that integrates digital, live, and in-store experiences to strengthen consumer connections [7] - Coca-Cola's marketing efforts include experiential marketing through music partnerships and gaming integrations, which help maintain brand visibility and pricing power [7]

Financial Data and Key Metrics Changes - System wide sales increased by 11% to $826 million, with same store sales growth of 5.8% for the quarter [6][20] - Total net sales rose by 11% to $403 million when adjusted for refranchising impacts [6][20] - Adjusted EBITDA increased by 6% to $104 million, with an adjusted EBITDA margin of 25.9%, a decrease of 110 basis points year over year [6][23] Business Line Data and Key Metrics Changes - The system wide store count reached 2,078, an 8% increase year over year [6] - Approximately one third of same store sales growth came from transactions, with the remainder driven by ticket growth [31][32] - Non-oil change revenue continues to grow, contributing positively to overall sales [90][93] Market Data and Key Metrics Changes - The company has not observed significant changes in consumer behavior despite macroeconomic uncertainties, with continued demand for services [12][44] - The company maintains a market share of about 5% in the overall market for oil changes, indicating substantial growth potential [12] Company Strategy and Development Direction - The company is focused on network growth, with plans to add approximately 200 stores through the acquisition of Breeze Auto Care [16][111] - Strategic priorities include enhancing marketing capabilities and improving customer engagement through technology investments [13][14] - The company aims to leverage its strong brand and customer data to differentiate itself from competitors [12] Management's Comments on Operating Environment and Future Outlook - Management expects minimal impact from tariffs and is confident in navigating cost changes through various strategies [10][26] - The company reaffirms its guidance for same store sales growth in the range of 5% to 7% for the full year [53][118] - Management remains optimistic about the resilience of the business, citing strong fundamentals and demand drivers in the industry [12][44] Other Important Information - The company is transitioning to a new CFO, Kevin Willis, effective May 19 [6] - Share repurchases for Q2 totaled $21 million, with a year-to-date total of $60 million, paused in anticipation of the Breeze acquisition [25] Q&A Session Summary Question: Can you break out the 5.8% same store sales between ticket and car count? - Transactions drove about a third of the overall comp, with two thirds driven by ticket growth, impacted by weekday mix and Easter shifts [31][32] Question: Is there a plan to take cost actions regarding SG&A? - Management expects SG&A growth to moderate and leverage to improve as refranchising impacts lessen [34][36] Question: Can you provide perspective on the cadence of comps throughout the quarter? - February was weaker due to challenging weather, but January and March showed consistent performance [42] Question: Are you seeing any impact from base oil deflation? - Modest deleverage in product costs was noted, with expectations for potential benefits from declining crude prices in the future [45][84] Question: What is the current penetration rate for non-oil change services? - The penetration rate for non-oil change services has been growing, with significant contributions from visual elements like wipers and filters [90][92] Question: How do lower oil prices impact gross margins? - Lower oil prices generally lead to delayed adjustments in lubricant pricing, with potential tailwinds expected if crude prices remain low [82][84]

Financial Performance - System-wide store sales reached $826 million, an increase of 11%[7] - Net sales were $403 million, up by 11%[8] - Adjusted EBITDA was $104 million, a 6% increase[11] - Adjusted EPS increased by 3% to $034[10] Network Growth - Valvoline achieved 58% system-wide same store sales growth[15] - The company added 33 net new stores, including 15 franchise and 18 company-operated locations[12] - Total system locations reached 2,078, an 8% increase[13] Strategic Initiatives - Refranchising and new partnerships are expected to add over 20 stores in fiscal year 2025[22, 25] - The company is targeting 250 unit additions per year[22, 25] Fiscal Year 2025 Guidance - Valvoline reaffirms its fiscal year 2025 guidance[48] - The company expects same store sales growth between 5% and 7%[52] - System-wide store additions are projected to be between 160 and 185[52] - Adjusted EBITDA is expected to be between $450 million and $470 million[52] - Adjusted EPS is projected to be between $157 and $167[52]

Financial Data and Key Metrics Changes - System wide sales increased to $530.3 million, up 9% in Q4 2024 compared to 8% in Q3 2024 [15] - Revenue for continuing operations increased 14% in Q4 2024, up from 10% in Q3 2024 [16] - Consolidated adjusted EBITDA was $3.3 million for Q4 2024 and $11.4 million for the full year 2024 [17][34] Business Line Data and Key Metrics Changes - System wide comp sales for all clinics opened for thirteen months were 6% in Q4 2024, up from 4% in Q3 2024 [15] - System wide comp sales for mature clinics opened for 48 months were modestly positive for Q4 2024, improving from negative 2% in Q3 2024 [15][26] - Revenue from franchise operations reached $14.4 million in Q4 2024, compared to $12.7 million in Q4 2023, reflecting a 14% increase [29] Market Data and Key Metrics Changes - The company served approximately 950,000 new patients in 2024, with 36% of them being new to chiropractic care [10][25] - The annual spending on chiropractic care is estimated at $20.6 billion, with out-of-pocket spending increasing from 37% to 42% [37] Company Strategy and Development Direction - The company aims to strengthen its position as a leading chiropractic care provider and become a pure play franchisor [9][12] - Plans include refranchising to reduce overhead and increase operating leverage, with a focus on dynamic revenue management and enhancing digital marketing [18][21] - The company is exploring new revenue streams, including B2B opportunities and additional clinical services [19][86] Management Comments on Operating Environment and Future Outlook - Management noted that consumer behavior is being affected by stubborn inflation and economic uncertainty, impacting patient demographics [47][48] - The company expects 2025 to be a transition year as it shifts from corporate-owned clinics to a franchise model, which will enhance profitability [35][90] - Management is focused on reducing G&A expenses to improve the bottom line significantly in the coming years [29][92] Other Important Information - The company opened 57 franchise clinics in 2024 and closed 18, resulting in a total of 967 clinics, with 87% being franchise clinics [27] - The company has received accolades, including being recognized as number 38 on the Fast and Serious 2025 list of the smartest growing franchises [44] Q&A Session Summary Question: Comments on potentially slower consumer behavior in Q1 metrics - Management acknowledged signs of consumer response to inflation and economic uncertainty, particularly affecting their target demographic [47][48] Question: Retention rates and trends - Retention rates remained stable, with strong conversion rates for new patients and slight upticks in attrition typical for January [51][53] Question: Status of refranchising efforts - The company has 125 corporate clinics, with the majority under LOI negotiations, aiming to complete refranchising in the first half of the year [55][80] Question: Trends in same store sales - Year-to-date trends are consistent with Q4 figures, with expectations for Q1 to align with previous trends [60][61] Question: Valuation of LOIs for refranchising - Management indicated that bidders are looking at a multiple of EBITDA for the corporate clinics, with ongoing negotiations [62][64] Question: Customer acquisition costs and revenue growth - Increased marketing spend is aimed at driving new patient acquisition, with a focus on optimizing customer acquisition costs [66][68] Question: Pricing strategy and legacy customer rates - The last wholesale price increase occurred in March 2022, with 80% of active members on standard rates and 20% on legacy rates [72][74] Question: Timing for new services and retail products - Exploration of new services and retail products is ongoing, with a focus on strengthening core operations before launching new initiatives [86]