Papa John's International shows strong free cash flow conversion of 235% relative to net income and a recovering MACD with RSI at 53, but carries a short interest of 23%, revenue declining at -8% year over year, and a dividend payout ratio of 555% that is deeply unsustainable at current earnings levels.
Thesis pillars
- Revenue Decline Quality Pressure→Stable
- High Short Interest Risk↓Deteriorating
- Unsustainable Dividend Risk↓Deteriorating
- +1 more pillar — see the Why tab for full reasoning
Pillars as of Jul 3, 2026, based on the 10-K filed Feb 26, 2026
Papa John's International, Inc. (PZZA) Stock Analysis
Inst Constrain edge
Consumer Cyclical · Restaurants
Sell if holding. Engine safety override at $18.54: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.4/10 and A.R:R 4.4:1 is above the 1.5:1 BUY gate. Specifically: High short interest: 28%; Below-average business quality; Negative price momentum. (Note: Risk dimension 4.3/10 and A.R:R 4.4:1 are different metrics that happen to read the same number here.)
Papa John's International operates and franchises pizza delivery, carryout, and dine-in restaurants under the Papa Johns brand, with 6,083 restaurants in 50 countries as of December 28, 2025 — 475 Company-owned and 5,608 franchised. The company earns revenue from Company-owned... Read more
Sell if holding. Engine safety override at $18.54: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.4/10 and A.R:R 4.4:1 is above the 1.5:1 BUY gate. Specifically: High short interest: 28%; Below-average business quality; Negative price momentum. (Note: Risk dimension 4.3/10 and A.R:R 4.4:1 are different metrics that happen to read the same number here.) Chart setup: No clear chart pattern; technical signals are mixed. Score 4.4/10, moderate confidence.
Passes 5/9 gates (favorable risk/reward ratio, clean insider activity, news events none recent, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and death cross (50MA < 200MA) and earnings proximity 6d<=7d. Suitability: speculative.
About Papa John's International, Inc.
About Papa John's International, Inc.
Papa John's International operated 6,083 restaurants across 50 countries and territories as of December 28, 2025 — 462 Domestic Company-owned units (13% of the North America system), 3,061 North America franchised locations, and 2,560 International restaurants, all but 13 of which are franchised. Domestic Company-owned restaurants generated average annual unit sales of $1.3 million in 2025, versus $1.1 million for North American franchised locations.
Papa John's earns revenue across four reportable segments: Domestic Company-owned restaurants (retail pizza sales), North America franchising (a standard 5% royalty on gross revenue plus development fees), North America commissary (dough and ingredient distribution through 11 U.S. Quality Control Centers plus one in Canada), and International, where standard royalties run 5% direct or 3% under master-franchise sub-license arrangements. Every Domestic franchisee must buy dough and pizza sauce from Papa John's own QC Centers and substantially all other food products from those centers or approved suppliers, a structure the company says preserves consistency but also ties commissary revenue directly to franchisee purchasing volume. Marketing is funded through required franchisee contributions to Papa John's Marketing Fund, Inc., a break-even nonstock entity that buys national television time and runs digital, loyalty, and social-media campaigns for participating Domestic restaurants.
Show full overview
Papa John's commissary model concentrates two of its highest-profile ingredients in single suppliers: the 10-K discloses the company is dependent on a sole supplier for all of its domestic mozzarella cheese and substantially all of its international cheese, and depends on a separate sole source for garlic sauce, with other key ingredients such as meat products sourced from only a limited number of suppliers. Because every Domestic franchisee is contractually required to buy dough and sauce through Papa John's own QC Centers, a disruption at either sole-source supplier would not just raise input costs — it would ripple through the commissary segment that generates royalty-adjacent revenue across the entire franchise system.
See also: Consumer Cyclical · Restaurants
From Papa John's International, Inc.'s most recent 10-K filing, extracted July 6, 2026.
Recent developments
updated 2026-10-29Recent Developments — Papa John's International, Inc.
Latest news
- NEWS Papa Johns Canada Re-launches Seasonal Jack-o'-Lantern Pizza — fiscal.ai Oct 19, 2026 neutral
- NEWS Stephens & Co. Maintains Equal-Weight on Papa John's International, Lowers Price Target to $19 — benzinga Oct 15, 2026 negative
- NEWS Papa John's International Reports Q2 2026 Results: Full Earnings Call Transcript — benzinga Oct 5, 2026 neutral
- NEWS 8 Consumer Discretionary Stocks With Whale Alerts In Today’s Session — benzinga Sep 24, 2026 neutral
- NEWS Top 3 Consumer Stocks That May Rocket Higher This Quarter — benzinga Aug 28, 2026 neutral
Generated 2026-10-29T13:34:03Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHSuppliermozzarella cheese10-K Item 1: 'We are dependent on a sole supplier for all of our cheese made from mozzarella domestically and substantially all of our cheese internationally.'
- HIGHSuppliergarlic sauce10-K Item 1: 'We also depend on a sole source for our supply of garlic sauce'
Material Events(8-K, last 90d)
- 2026-06-30Item 5.02MEDIUMCFO and President-North America Ravi Thanawala resigned effective June 30, 2026 to take a CFO role at another public company; no disagreement with the Company cited. Christopher K. Collins named interim CFO effective the same date while a permanent-CFO search is conducted.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. People who build TrendMatrix, or entities they control, may hold positions, long or short, in securities it covers, and may trade them at any time. Positions are not disclosed individually. Verdicts are generated by an automated model applied by the same rules to every covered stock, and are not adjusted for any position held by the people who build TrendMatrix. We do not accept payment from issuers for coverage.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
Rating Breakdown
5 floor-breakers
Revenue shrinking — -8.8% YoY. Growth thesis broken unless recovery story develops.static
No near-term catalyst priced in. Thesis progression will come from fundamentals grinding, not event reaction.static
Price action weak — below key moving averages, no momentum carry. Needs a base before trend-continuation setups apply.static
Quality below the gate floor. Component breakdown shows what dragged the score down.static
Ranks in the bottom of its industry peers on the composite signal. Better names in the same sector exist.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. Engine safety override at $18.54: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 4.4/10 and A.R:R 4.4:1 is above the 1.5:1 BUY gate. Specifically: High short interest: 28%; Below-average business quality; Negative price momentum. (Note: Risk dimension 4.3/10 and A.R:R 4.4:1 are different metrics that happen to read the same number here.) Chart setup: No clear chart pattern; technical signals are mixed. Prior stop was $17.24. Score 4.4/10, moderate confidence.
Analyst target: $24.36 (+31.4% upside). Prior stop was $17.24. Stop-loss: $17.24.
Concentration risk — Supplier: mozzarella cheese; Concentration risk — Supplier: garlic sauce; Quality below floor (3.8 < 4.0).
Papa John's International, Inc. trades at a P/E of 23.2 (forward 14.3). TrendMatrix value score: 7.4/10. Verdict: Sell.
20 analysts cover PZZA with a consensus score of 3.5/5. Average price target: $28.
What does Papa John's International, Inc. do?Papa John's International operates and franchises pizza delivery, carryout, and dine-in restaurants under the Papa...
Papa John's International operates and franchises pizza delivery, carryout, and dine-in restaurants under the Papa Johns brand, with 6,083 restaurants in 50 countries as of December 28, 2025 — 475 Company-owned and 5,608 franchised. The company earns revenue from Company-owned restaurant sales, 5% franchise royalties, and commissary sales through its 11 U.S. Quality Control Centers that supply dough and ingredients to Domestic restaurants.