JPMorgan Chase thinks Domino’s Pizza’s stock is trading at a discount compared with what the company charges for key products. The firm upgraded Domino’s to overweight from neutral Thursday with a $360 price target, up from $340, representing potential 24% upside from the $289.85 close Wednesday. Domino’s stock is down 16.3% since the start of 2023. DPZ YTD mountain Some pressure on Domino’s stock so far this year isn’t swaying JPMorgan’s upgrade to overweight. A JPMorgan downgrade of Domino’s in summer 2021 “has ‘played out’ and a fresh look at estimates shows the stock as too cheap for what is a structurally low cost delivery at $6.99 for a medium 2-topping and take-out provider for a $7.99 3-topping large pizza,” analyst John Ivankoe said. Ivankoe added Domino’s franchisees don’t have many reasons to decide to close stores, given the average U.S. franchise owner oversaw seven stores with roughly $140,000 each in free cash flow in 2022. That is only marginally lower than about $143,000 per store in 2019. “We also do not believe any of them require the company’s financial assistance as seen at other quick service chains, meaning the revenue and FCF base at DPZ remains intact,” Ivankoe added. — CNBC’s Michael Bloom contributed to this report.