Why is Domino’s Pizza (ASX: DMP) up more than 10%?
Dominos (DMP is enjoying a stellar session today following a solid business update into a heavily shorted stock – more than 13% of DMP was held short at the last reported date.
- DMP’s reaffirmed FY2026 underlying NPAT guidance of $118–122 million, easing fears of a downgrade despite same-store sales declining 4.1% across ANZ, Europe and Asia.
- The company also announced $259–300 million of non-cash write-downs and the closure of up to 60 underperforming stores, positioning the moves as a one-off portfolio reset rather than an ongoing earnings headwind.
The update has sparked a sharp short squeeze, with investors forced to cover positions after the feared earnings downgrade failed to materialise. As one of the ASX’s most heavily shorted stocks, Domino’s has traded ~7x its average daily volume.
We don’t see this update as a reason to buy DMP, but we would be a very uncomfortable holding a meaningful short.
