How Political Turmoil May Be Benefitting Papa John's
If ever there was a time to invest in pizza delivery, it's now. Papa John's stock price is on the rise, which is no great wonder. Between the aftermath of the political conventions, the civil unrest, and the attacks upon attacks constantly being hurled all over the news, it's enough to make anyone want to curl up on the couch with a box of pizza and so much garlic dipping sauce. Seriously, that's what investors think.
According to KeyBanc Capital Markets, one of Papa John's major investors, all the political unrest and intrigue of the 2016 presidential election, as well as all the other controversies in today's news, could be encouraging customers to order from easy, convenient delivery chains. As the Casual Dining segment, which includes chains like Applebee's and Buffalo Wild Wings, has been declining in recent weeks, Papa John's shares have been on the rise.
KeyBanc analysts chalk this up to people staying home to watch the news and process recent events. And it doesn't look like the turmoil is going anywhere anytime soon. Accordingly, the bank has upgrade Papa John's stock from "standard weight" to "overweight." What that means is that Papa John's stock is a pretty good bet right about now. Although it could probably also refer to customers who have caused the recent uptick in stock prices.
Of course, it's not just staying home to watch the news that may be driving up shares. After all, if it were just about staying in, we could easily just see an increase in grocery store profits without any effect on companies like Papa John's. First We Feast points out that a large part of this might be "the convenience—and perceived safety—of ordering pizza to one's home."