Should Investors Throw A 'Pizza Party' And Buy Domino's?

The restaurant sector has been under serious pressure as of late following a bearish call by Stifel's restaurant analyst Paul Westra. The segment is also getting little help from earnings season in which 15 of the 16 restaurant chains that reported second-quarter results thus far said sales fell from a year ago.

Related Link: Stifel Expects A Recession Within 3 To 9 Months; Bearish On Restaurants

According to Bloomberg's Shelly Banjo, average comparable sales for the entire restaurant sector dipped into negative territory in the recent quarter for the first time since 2009.

There is, however, one stand-out in the restaurant sector. Banjo said Domino's Pizza, Inc. DPZ is the lone restaurant chain in the Bloomberg Intelligence restaurant index that reported earnings results which showed a growth in sales during the second quarter compared to a year ago.

Domino's said sales at established U.S. locations rose nearly 10 percent, marking the ninth consecutive quarter of growth above 5 percent.

Domino's isn't only a tasty way of feeding a family, it's also cheap. There are few ways to treat a family for less than $10; a 3-topping large pizza at Domino's sells for as little as $7.99.

Domino's is also at the forefront of the digital revolution as half of its entire U.S. sales are done through digital ordering. For the ultimate lazy customers that can't be bothered to get up from the couch and reach their smartphone, Amazon's voice-controlled Echo can understand a pizza order and relay the information to Domino's.

Finally, Banjo cautioned that Domino's stock is trading at a multiple of 32 times forward earnings, above its 5-year average of 28x and a premium to some of its restaurant peers.

"But with pickings slim for growth elsewhere in the restaurant industry, pizza may still be one of the best choices on the menu," she concluded.