UPDATE: Oppenheimer Downgrades Domino's Pizza on Constrained Earnings Upside, Tough Comp Cycle

In a report published Thursday, Oppenheimer analyst Brian Bittner downgraded the rating on

from Outperform to Perform, and removed the $64.00 price target. In the report, Oppenheimer noted, “DPZ has been a top-pick since August 2011. We expect operating metrics and management execution to remain elite, but downgrade to Perform because: 1) earnings upside opportunity appears constrained (low operating leverage and a lack of financial engineering catalysts); 2) comps now enter a cycle of tough comparisons and growth will likely decelerate without identifiable grow-over drivers (such as pan pizza last year); 3) valuation (25x P/E, 16x EV/EBIT) is at an all-time peak (now in line with DNKN) and multiple expansion from here is difficult to justify following the stock's outperformance of the past two years (+192%, vs. S&P +41%).” Domino's Pizza closed on Wednesday at $69.63.