Domino’s: This Is How A Pizza Chain Stock Did Just As Well As Google

Joe Weisenthal (0:10)

Hello, and welcome to another episode of the Odd Lots Podcast. I'm Joe Weisenthal.

Tracy Alloway (0:16)

And I'm Tracy Alloway.

Joe Weisenthal (0:18)

Tracy, I have a question about the lockdowns, or I guess Hong Kong never really had a lockdown, did it?

Tracy Alloway (0:25)

Well, so we had a lot of bars and restaurants that closed just because people weren't going out, but I don't think we ever ended up having a formal lockdown exactly like they've had in the States, which is kind of weird, because if you think about it, Hong Kong was early to the coronavirus and people were really worried about what would happen here. But I guess in the end, we've come out pretty good and we've had a decent experience of the lockdown.

Joe Weisenthal (0:52)

So I guess you guys have missed, and maybe it would be different in Hong Kong anyway, this phenomenon of here in the US, people are ordering pizza like crazy. Obviously, pizza delivery is one of the big things, but I guess, I don't know, I guess pizza's probably not as big of a cuisine there, but without the lockdown, you guys have probably missed this whole phenomenon of people just eating tons and tons of pizza during this whole crisis.

Tracy Alloway (1:16)

The cultural phenomenon of people ordering lots of pizza. You're gonna have to explain this to me, because yeah, I've missed this.

Joe Weisenthal (1:23)

You know what I was thinking, Tracy? I was thinking, at this point, you should just move back to the US.

We can talk about that another time, but anyway, we can revisit.

Tracy Alloway (1:32)

It's not fair to try to lure me back to the US using pizza. That's not fair, come on.

Joe Weisenthal (1:36)

Okay, all right, we'll move on from that. But anyway, pizza is booming. In fact, I just, last night, I was on my bike and I biked by a Domino's and they had this big sign. Maybe I'll put it in the post where you post the podcast. They had this big sign that says business is booming. We are hiring, people are ordering a lot of pizza these days.

One other question, have you read the novel Snow Crash by Neil Stevenson?

Tracy Alloway (2:01)

Snow Crash, no, I haven't. It's a sci-fi book, I want to say, right?

I haven't read it.

Joe Weisenthal (2:08)

Yeah, it's kind of like a cyberpunk novel, so to speak. And there's this great line in there talking about the description of society and this future state. He says, there's only four things we do better than anyone else, music, movies, microcode, by which you mean software, and high-speed pizza delivery. That is the essentially the US economy of the future.

And this world of music, movies, software, and high-speed pizza delivery, it's like, I've been thinking a lot about snow crash during this crisis.

Tracy Alloway (2:37)

All right, so coronavirus is proof of America's dystopian prowess for high-speed pizza delivery. Is that what you're saying?

Joe Weisenthal (2:45)

Yeah, because it's all about how all manufacturing has been outsourced to other countries.

The US doesn't build anything. There's all these divisions between states, and basically everyone is either a coder or a pizza delivery person in this book. So everyone should read it. Anyway, one other interesting fact, and I mentioned that Domino's was booming, and one of my favorite facts is that Domino's Pizza came public in 2004 about two weeks before Google did. Did you know that?

Tracy Alloway (3:19)

Yeah, I've seen the chart. By the way, can I just say before we go any further, I feel like you could talk about pizza for a good three or four hours. Well, we're going to.

You've already brought in cyberpunk, sci-fi fiction, and now you're doing the stock market stuff. Okay, well, anyway, yes, I have seen the chart. Anyone who's spent any time on Twitter has probably seen it as well. It's pretty amazing. The basic idea is that both Domino's Pizza and Google went public around the same time. I think it was 2004 And if you look at the chart, they've basically had a pretty similar trajectory. So everyone thinks if you invested money in the early 2000s in Google, then you haven't made this tech genius and you've made millions of dollars.

No one ever thinks, well, actually, if you put money into this simple pizza company, you would have made the same amount.

Joe Weisenthal (4:14)

Yeah, so Google went public August 19th, 2004 Domino's went public July 13th, 2004, so barely a month apart.

And both of them are up about 28 and a half fold since then. Like it's truly incredible that the lines are identical. Anyway, okay, that is a lot of setup. We're going to talk about pizza today because I want to get the story of how this one company did so well, how a pizza company performed so well on the market. And I thought, you know, with the coronavirus crisis, getting everyone to eat pizza, I thought this was a good time to sort of talk about the incredible story of Domino's Pizza.