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NEW YORK (AP) — The country's three biggest publicly traded pizza chains are positioned to take a bigger slice of the market as independent chains struggle in the challenging economy, a Citi analyst said Tuesday.
THE OPINION: Analyst Gregory Badishkanian noted that the pizza category is growing modestly, but that national chains have been expanding their share of the pie.
Pizza Hut, which is owned by Yum Brands Inc.; Domino's; and Papa John's together control just 30 percent of the $35 billion market, he noted, with smaller chains and independent operators accounting for the rest.
But he said that the slow economy has led to a slew of restaurant closures and that the three companies have a "significant opportunity" to take more business, even as sales trends may be slowing from the previous quarter.
Badishkanian noted that the companies can leverage their brand names, national advertising and technological initiatives, such as online ordering and delivery tracking.
Given the tough economic climate, chains that underscore value are doing better, a trend that is expected to continue, he wrote.
THE STOCKS: Shares of Yum were down 8 cents at $66.46. Shares of Domino's Pizza Inc. were down 29 cents at $33.90. Papa John's International Inc. shares were up 41 cents at $51.78.