A friend of mine -- who recently came to LA -- ordered a Papa John's Int'l, Inc. (Nasdaq: PZZA) pizza. She used the Internet. All in all, it was pretty efficient.

Well, according to a recent report, Papa John's has sold about $1 billion in pizzas (over the past seven years). That's certainly a lot of dough, huh? And, as should be no surprise, the growth rate has been stunning: about 50% per year.

There is lots of competition, such as Dominos Pizza (Nasdaq: DPZ) and Pizza Hut. And interestingly enough, Pizza Hut plans to launch a web-enabled widget so you can get pizza at super-fast speeds (I'm sure this will be a big hit for Web 2.0 programmers, who tend to eat pizza at about 2 a.m.).

But, as my friend has experienced, there are some glitches. Ordering online it took two hours for her to get her pizza.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Domino's Pizza, Inc. (NYSE: DPZ) saw its Q3 profit drop by a staggering 55% as reported this morning. Domino's management explained the root causes as weak consumer spending added with cost pressures. Cost pressures? Apparently, either the cost of making pizza has changed big-time in the last three months, or gas prices and commodity food product prices have gone up. I'll take the latter -- you?

For the Q3 period, Domino's net income dropped to $10.99 million or $0.17 per share from $24.5 million or $0.39 per share in the year-ago quarter. Most analysts expecting about $0.23 EPS. The food company's quarterly revenue rose 3.2% to over $337 million as international sales became the star of the quarter. CEO David Brandon suggested that trying to mix increasing prices with declining traffic was a challenge in the quarter. Also mentioned was ... wait for it ... higher food costs. Milk prices (cheese) indeed went up, but at the butt-end of Q3, not during the whole period. Could this be an excuse?

While weak domestic consumer spending hampered sales, international sales did just the opposite, increasing 8.3% for the quarter. Have Domino's done enough in the Q3 period to goose more sales from customers, if that was even possible? I'll say that Papa John's International (NYSE: PZZA) advertised like crazy in my area this past quarter -- on television, newspapers and in other areas. I saw next to nothing from Domino's. I wonder if the company is masking "declining sales" with "losing business to the competition?"

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When I saw the headline in today's USA Today that Subway and Dunkin Donuts are going to start selling pizza, I threw up a little bit in my mouth. Just to be sure it's not a personal thing, I asked a few friends and we all reached the same conclusion: There's a small possibility that I would buy pizza at Subway, and zero chance I would buy it at Dunkin' Donuts. And especially not for breakfast.

McDonald's (NYSE: MCD) tried pizza years ago and left with its tail between its legs, but apparently Subway and Dunkin' still can't resist reaching for a piece of the $28.5 billion pizza pie.

Subway has been selling pizza at more than half of its locations since the summer, and would like more franchisees to do the same, but is not requiring it. According to the USA Today, "Subway's $2.99 thick-crust pizzas arrive frozen. They're defrosted, then baked in the toaster ovens in about 90 seconds. Meat toppings are a buck each. Veggies are free." Yum?

What do you think? Are my friends and I crazy, or are these forays into pizza ill-advised and destined to fail?

Apparently all those newspaper articles telling Americans we are fat are beginning to have an effect

. For two consecutive quarters, Papa John's International, Inc. (Nasdaq: PZZA) has posted decreases in domestic sales at both company-owned restaurants and franchised locations. Recently released earnings report for 2Q 2007 stated U.S. pizza sales at Papa John's restaurants declined 1%. That's not enough to cause undue worry, but the company is also being squeezed by rising labor, utility, distribution and commodity costs. Revenues were up 6% to $256.3 million and EPS were $0.23, above analysts' expectations. But that amount is still half of what the company posted in 2Q 2006. In what is beginning to look like a disturbing pattern, revenues from the previous two quarters have increased while EPS has declined by 33%. In 2Q 2007, revenues increased due only to the acquisitions of 73 new locations. There was NO organic growth.

Figures for 2Q 2007 are not representative as they include restructuring and consolidation costs of BIBP Commodities, a cheese purchasing company Papa John's now owns and which it purchased in hopes of eventually realizing lower prices on dairy commodities. Operating income for the quarter was reported as up only if costs of BIBP were excluded.

The picture is a bit better for Papa John's international market. Good thing the Chinese don't mind getting fat. Despite the fact the international sales rose 2%, this segment still yielded operating losses though the losses of $2 million for 2Q are narrowing when compared to previous quarters. Papa John's has opened 8 new locations in South Korea and China, the company's fastest growing markets. A big, multi-year expansion plan calls for opening 100 new international locations per year for the next nine years. At least 369 of those new locations will be in Korea and China. Such expansion, however, does open Papa John's to financial problems associated with fluctuations in currency exchange rates.

Papa John's repurchased $10 million in stock during 2Q as part of a longer and larger $675 million buyback program. CEO Nigel Travis remains optimistic that sales and earnings will improve and has raised FY guidance from $1.52-$1.58 to $1.56-$1.60. This is good news. Let's celebrate with pizza.

Yum! Analysts and investors alike eagerly gobbled up the first quarter earnings surprise for Yum! Brands (NYSE: YUM), sending the stock up 6%, to $66.91 as of late afternoon, an increase of $3.79. The shares were briefly over $69, an all-time high for the company. The 70 cents-per-share profit was a 14% increase from the year-ago quarter and six cents ahead of analyst consensus.

The favorable results are even more of a surprise given that Yum! has taken several hits with its brands this year, from a rat infestation at a combined Taco Bell/KFC restaurant in New York to a lawsuit over the E-coli outbreak of Q4 2006, and has yet to discover any benefit from the removal of trans fat at its KFC restaurants.

Despite all the world's concentration on the obesity epidemic, the rise in popularity of organic foods, and the general frowning-upon marketing of fast food and other unhealthy choices to children; it seems like a great time to be the owner of some fast food stock.

[Photo kanepsphotography.]

For those still fuming over Pizza Patron's "Pizza for Pesos" program, the fun continues. The Dallas-based chain, which had drawn the ire of an untold number of currency purists, announced that its policy would become permanent.

In early January, Pizza Patron -- with 60 stores spread across Texas, Arizona and Colorado -- began a two-month trial period during which they accepted Mexican currency at 12 per U.S. dollar (the current rate being approximately 11 to 1) to honor their Hispanic patrons, which they claim account for 60% of their business.

What resulted exactly from this progressive and inclusive policy? People pretty much lost their cool.

The restaurant reported a deluge of critical e-mails, including death threats, and inadvertently threw their hat into the hostile immigration debate. "This is the United States of America, not the United States of Mexico," one critical e-mail read. "Quit catering to the damn illegal Mexicans," demanded another.

While most businesses along the Mexican and Canadian borders welcome foreign currencies as a courtesy, Pizza Patron's restaurants stretch as far away as Denver, intensifying the debate. Said Patricia Perez, a partner at L.A. public relations firm Valencia, Perez & Echeveste, "Right now there's a lot of anti-immigrant rhetoric going around that could make them a lightning rod."

From an undisclosed location, Pizza Patron founder and CEO Antonio Swad (who, incidentally, is Italian/Lebanese) said in a statement, "What the pesos for pizza program is intended to do is reinforce our brand promise - as the premier U.S. Latino brand.... We have carved this niche in the pizza industry to compete and serve an underserved market - the Latino customer, not to make any political statement."

B. Brandon Barker is the author of the novel Operation EMU.

Tonight Jim Cramer took a page from a TV man oh-so-like himself and kicked it up a notch! For his second feature stock on CNBC's MAD MONEY, Cramer got hot and bothered over Chipotle Mexican Grill, Inc. (NYSE:CMG). What about pizza? Cramer says it's "out," after all, look at California Pizza Kitchen, Inc. (NASDAQ:CPKI), which is down 10% at $28.35 after-hours because of cautioning that its outlook wasn't quite so tasty despite a great third quarter. When pizza is out? Fast Mexican food is in.

See, Cramer isn't just an investor. He's also a food critic. And this is a case where the food critic and the investor can come together for "burrito investing." Cramer said he was in denial that pizza sales were down and he thought it was maybe just a Domino's Pizza, Inc. (NYSE:DPZ) issue, but he was wrong. Domino's had had same store sales declines since Q4 of last year. Before Cramer even mentioned CMG the stock gapped over 2% to $58.00 in after-hours trading on NYSE/Archipelago trading.

Cramer calls burritos "the new pizza." Stay away from names like Papa John's Int'l, Inc. (NASDAQ:PZZA), says Cramer, as people are leaving for "Taco John's." Also of note in the hot Mexican trend is Jack in the Box Inc. (NYSE:JBX) for its Qdoba Mexican Grills (3% of JBX business), which he said that the place wasn't bad. Cramer said he is hesitant to be a BUY BUY BUY, but it has come down a bit. Cramer said that salsa is now the number 1 condiment in America. Cramer said you may never replace pizza in America, but investors need to be in burritos as people are eating more Mexican food than pizza. CMG & JBX are trumping PZZA & DPZ.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.

[Photo Shane Adams]