Pizza is king

Restaurant industry is in a slump, but the pizza business

Bloomberg News

In a year when restaurant chains have bemoaned sluggish traffic, competition from supermarket food and even the chilling effect of the presidential election, one area has continued to thrive - pizza.

Shares of Domino's Pizza are up 45 percent this year. And Papa John's International is up more than 60 percent. Compare that with a 3.4 percent gain for the Standard & Poor's 500 Restaurants Index.

The reasons are pizza is cheap, fast and increasingly easy to get - thanks to user-friendly mobile-ordering apps and technology that lets diners order from Facebook, Twitter and Apple TV. That's helped insulate pizza chains from a shift away from eating out.

'Restaurants that have succeeded this year have been the ones that have addressed convenience,” said Stephen Anderson, an analyst at Maxim Group. 'The pizza chains have done a good job at this.”

The U.S. restaurant industry largely has been mired in a slump. Some have blamed negativity around the election, and now uncertainty about the president-elect's planned policies on issues such as immigration and minimum wage.

Cheaper wares at supermarkets - driven by food deflation - also are enticing Americans to save a buck by cooking at home. Yet diners' pizza habits haven't been hurt.

Domino's same-stores sales gained 13 percent in the United States last quarter, while Papa John's sales climbed 5.5 percent by that measure in North America.

Fast-food and fast-casual rivals have tried to follow suit. McDonald's, the world's biggest restaurant company, said last week it's testing delivery service at about 200 Florida locations.

Wendy's says it's working on mobile ordering.