The Domino's Pizza Enterprises Ltd (ASX: DMP) share price has been a positive performer on Monday.
In afternoon trade, the pizza chain operator's shares are up over 4% to $108.44.
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Why is the Domino's share price charging higher?
Today's gain appears to have been driven by a broker note out of Citi this morning.
According to the note, the broker has taken its sell rating off the company's shares and upgraded them to a neutral rating.
Citi also increased its price target by approximately 44% to $104.20.
What did the broker say?
Citi has been looking at the company's options in Europe and sees scope for Domino's to expand into a number of new markets such as Italy and Spain.
At present, the company is the largest franchisee outside of the USA. It holds the master franchise rights to the Domino's brand and network in Australia, New Zealand, Belgium, France, The Netherlands, Japan, Germany, Luxembourg, and Denmark.
From these markets, Domino's is aiming to grow its network from ~2,800 stores today to 5,550 stores by 2031.
However, Citi believes that Domino's could add a further ~2,500 stores to this total by expanding into other European markets. It notes that this would boost its profits materially.
Can the Domino's share price go higher?
As you might have noticed, despite lifting its price target by 44%, the Domino's share price is still trading beyond it. This would imply that the upside from here is not only extremely limited, but the risk could even be to the downside.
The good news is that another leading broker still believes the Domino's share price can go even higher. That broker is Morgans, which currently has an add rating and $119.00 price target on the company's shares.
Based on the latest Domino's share price, this implies potential upside of 10% over the next 12 months.
