Papa John's to Report Q4 Earnings: What's in the Offing for the Stock?

Papa John's International, Inc. PZZA is scheduled to report fourth-quarter 2025 results on Feb. 26, before the opening bell. In the last reported quarter, its earnings missed the Zacks Consensus Estimate by 20%.

PZZA’s earnings topped the consensus mark in three of the trailing four quarters and missed on the remaining occasion, the average surprise being 10.2%.

Papa John's Q4 Estimates

The Zacks Consensus Estimate for earnings is pegged at 33 cents per share, indicating a decline of 47.6% from the prior-year level. In the past 30 days, estimates for earnings have remained unchanged.

Papa John's International, Inc. Price and EPS Surprise

Papa John's International, Inc. price-eps-surprise | Papa John's International, Inc. Quote

The consensus mark for revenues is pegged at $514.9 million, implying a decline of 3% from the year-ago level.

Factors to Note for Papa John's Q4 Release

Papa John's fourth-quarter fiscal 2025 top line is expected to decline year over year due to weaker consumer demand in North America and continued pressure on transactions. Weak comparable sales in the region are likely to have weighed on the quarter. Lower transaction volumes, mainly from small-ticket web customers, are expected to have remained a drag. A softer consumer backdrop and a highly promotional QSR environment are likely to have added pressure.

North America comparable sales declined in the third quarter, and softer trends seen in September continued into October. This trend is likely to have extended into the fourth quarter amid cautious consumer spending and ongoing macro challenges.

We expect domestic company-owned restaurant sales to decrease 2.9% from the year-ago level. Our model predicts North America’s commissary revenues and franchise royalties & fees to decline 3.8% and 1.8% from the year-earlier actuals, respectively.

However, menu innovation, value-focused promotions and a focus on digitalization bode well. The company continues to invest in digital ordering platforms and loyalty initiatives, which are expected to have supported customer engagement and sales trends.

High costs are likely to have hurt PZZA’s bottom line. Higher marketing spend, incentive compensation and continued investments in technology and restaurant support are expected to have driven costs in the quarter to be reported.

What the Zacks Model Unveils for PZZA

Our proven model predicts an earnings beat for Papa John's this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is exactly the case here.

Earnings ESP of PZZA: Papa John's has an Earnings ESP of +11.38% at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

PZZA’s Zacks Rank: Papa John's currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Here are some other stocks from the Zacks Retail-Wholesale you may consider, as our model shows that these, too, have the right combination of elements to beat on earnings this season.

Starbucks SBUX has an Earnings ESP of +0.58% and a Zacks Rank of 3 at present.

In the to-be-reported quarter, Starbucks’ earnings are expected to register a 2.4% year-over-year increase. Starbucks’ earnings missed the Zacks Consensus Estimate in each of the trailing four quarters, the average negative surprise being 12.1%.

The Cheesecake Factory Incorporated CAKE currently has an Earnings ESP of +1.22% and a Zacks Rank of 3.

In the to-be-reported quarter, Cheesecake Factory’s earnings are expected to increase 4% year over year. CAKE’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 9.9%.

Restaurant Brands International, Inc. QSR currently has an Earnings ESP of +0.30% and a Zacks Rank of 3.

In the to-be-reported quarter, Restaurant Brands’ earnings are expected to register a 9.3% year-over-year rise. Restaurant Brands’ earnings surpassed estimates in two of the trailing four quarters and missed twice, the average negative surprise being 0.2%.

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This article originally published on Zacks Investment Research (zacks.com).

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