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Commodities: Domino's definitely do fall ... and fast

The news in pizza stocks last week was Domino's. The brand watched its stock do a peregrine falcon-style dive Tuesday, dropping 8 percent from the previous day's close.

July 31, 2017 by S.A. Whitehead — Food Editor, Net World Media Group

The news in pizza stocks last week was Domino's. The brand watched its stock do a peregrine falcon-style dive Tuesday, dropping 8 percent from the previous day's close shortly after trading started for the day. The company released its Q2 financials last week, and although it was largely quite positive, international sales did not perform as well as expected, which some analysts have reported affected last week's stock price.

None of the stocks monitored by this site, however, did well last week, aside from Yum, which gained slightly. There was some optimism for pizza restaurateurs, however, in commodity prices, which aside from cheese and auto fuel, ran lower.

Cheese

After dairy farmers' "Summer of Discontent" over falling cheese prices, we enter the last "unofficial" month of summer with cheese prices markedly higher than the end-of-June price of $1.51. Friday at the close of trading, however, cheese was selling at $1.76, which is even slightly higher than paid at the start of June. 

Wheat

Kansas City U.S. No .1 Hard Red Winter, ordinary protein rail bid was 22 3/4 to 32 3/4 cents lower from $4.88-$5.61 per bushel. Kansas City U.S. No. 2 Soft Red winter rail bid was not quoted.  

St. Louis truck U.S. No. 2 Soft Red Winter terminal bid was 26 to 27 cents lower from $4.80-$4.84 per bushel.  Minneapolis and Duluth U.S. No. 1 Dark Northern Spring, 14.0 to 14.5 percent protein rail, was 41 1/2 to 61 1/2 cents lower from $7.91 1/2-$8.51 1/2 per bushel. Portland U.S. Soft White wheat rail was 15 to 21 cents lower from $5.14 3/4-$5.30 per bushel.

Weekly export sales and shipments for wheat may be viewed as neutral, with export sales totaling 18.3 mb and shipments totaling 17.5 mb.  

Gasoline and diesel fuel

                               Regular      Mid-Grade      Premium      Diesel

Current Avg.           $2.316       $2.595             $2.841         $2.470

Yesterday Avg.       $2.313       $2.589             $2.836         $2.467

Week Ago Avg.       $2.282      $2.568             $2.815          $2.453

Month Ago Avg.      $2.239      $2.541             $2.789          $2.441

Year Ago Avg.        $2.135       $2.415             $2.653          $2.319

Natural gas

Natural gas spot prices fell at most locations this report week (Wednesday, July 19 to Wednesday, July 26). The Henry Hub spot price fell from $3.10 per million British thermal units (MMBtu) last Wednesday to $2.92/MMBtu yesterday. 

At the New York Mercantile Exchange (Nymex), the August 2017 contract price fell 14 cents, from $3.066/MMBtu last Wednesday to $2.924/MMBtu yesterday. 

Net injections to working gas totaled 17 billion cubic feet (Bcf) for the week ending July 21. Working natural gas stocks are 2,990 Bcf, which is 9 percent less than the year-ago level and 4 percent more than the five-year (2012-16) average for this week. 

The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 22 cents, averaging $6.31/MMBtu for the week ending July 26. The price of natural gasoline, ethane, propane, butane, and isobutane all rose, by 1, 1, 4, 7 and 7 percent respectively. 

According to Baker Hughes, for the week ending Friday, July 21, the natural gas rig count decreased by 1 to 186. The number of oil-directed rigs fell by 1 to 764. The total rig count decreased by 2, and it now stands at 950. 

Pizza company stocks

Domino's stock defined the phrase Tuesday, "Oh what a difference a day can make." After closing at the bell last Monday at $214.22, the stock had sunk to 194.24 Tuesday morning, ending even lower at the close of trading Friday at $183.09. 

Parent company of the competing brand,  Pizza Hut, fared better but only slightly. Yum Brands closed Friday at $75, that's up a quarter from the previous Friday's close at $74.75. But fellow Louisville-based brand, Papa John's fell as well of the course of the trading week. The stock closed Friday at $71.49, down significantly from the previous Friday's close of $76.54. 

Finally, Papa Murphy's lost some value over the trading week, closing Friday $4.33, down 13 cents from the previous week's close of $4.56. 

Photo: iStock

About S.A. Whitehead

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Pizza Marketplace and QSRweb editor Shelly Whitehead is a former newspaper and TV reporter with an affinity for telling stories about the people and innovative thinking behind great brands.