Citi downgraded Domino’s Pizza (NYSE:DPZ) to Impartial from Purchase on Friday, explaining that the newest earnings outcome had damaged their beforehand bullish thesis.

The analysts famous that the underside line increase from the carryout enterprise is just not sufficient to offset clearly rising competitors and slowing tendencies for supply. Moreover, the deal with QSR competitors within the earnings name obscures rising competitors from full service operators.

“Decelerating tendencies in each supply/carryout and an solely 2% SSS Hole between basically absolutely staffed shops and the underside quintile of shops recommend the issues run deeper than simply staffing/the options could also be a more durable repair,” the downgrade defined. “This can translate into at the least one other yr of challenged prime/bottom-line progress, and, with restricted visibility into earnings progress sustainably reaccelerating to prior-norms regardless of still-elevated valuation vs. friends/market, we’re stepping apart.”

Shares of the Michigan-based pizza chain fell about 1.3% in premarket buying and selling on Friday, extending a double-digit decline marked on Thursday.

Learn extra on the particulars of Thursday’s earnings outcomes.