Papa John’s downgraded to Sell from Hold at Stifel

Stifel analyst Chris O’Cull downgraded Papa John’s to Sell from Hold with an unchanged price target of $65. The analyst believes the turnaround of the U.K. market could take several quarters to gain traction, resulting in more significant operating losses for the international segment than the Street is currently projecting. The firm says mandated minimum wage hikes and aggregator pricing power, coupled with the need to focus on low-price value, will make it difficult for U.K. pizza operators to improve profitability in 2024. Stifel believes these headwinds will likely prolong Papa John’s U.K. turnaround efforts. Its second concern is that the company’s net unit growth will fall short of Street expectations for 2024.