Accessibility StatementSkip Navigation Darden Restaurants Reports Fiscal 2026 First Quarter Results; Declares Quarterly Dividend; And Updates Fiscal 2026 Financial Outlook Darden Restaurants, Inc. (NYSE:DRI) today reported its financial results for the first quarter ended August 24, 2025. First Quarter 2026 Financial... ORLANDO, Fla., Nov. 20, 2025 /PRNewswire/ -- Darden Restaurants, Inc., (NYSE: DRI) plans to release its fiscal 2026 second quarter financial results before the market opens on Thursday, Dece ...

Company Overview - Darden Restaurants, Inc. (DRI) has a market cap of approximately $20 billion and operates over 1,700 restaurants across multiple brands in the U.S. and Canada, including Olive Garden, LongHorn Steakhouse, The Capital Grille, and Cheddar's Scratch Kitchen [1] Stock Performance - DRI shares have underperformed the broader market over the past 52 weeks, rising only 5.1% compared to a 14.5% increase in the S&P 500 Index [2] - Year-to-date, DRI shares are down 5.9%, while the S&P 500 has gained 16.5% [2] - The company has also lagged behind the Consumer Discretionary Select Sector SPDR Fund's 9.9% return over the same period [3] Recent Financial Results - On September 18, DRI shares fell 7.7% after reporting Q1 2026 adjusted EPS of $1.97, which missed Wall Street estimates [4] - Quarterly sales reached $3.04 billion, meeting forecasts, but operating costs surged 8.8% to $2.71 billion due to increased ingredient and marketing expenses [4] - Management raised its annual sales growth outlook to 7.5% - 8.5%, but the midpoint fell slightly below analysts' average expectations, negatively impacting investor sentiment [4] Earnings Expectations - For the fiscal year ending in May 2026, analysts project DRI's adjusted EPS to grow 11.1% year-over-year to $10.61 [5] - The company's earnings surprise history is mixed, with one beat and three misses in the last four quarters [5] - Among 30 analysts covering the stock, the consensus rating is a "Moderate Buy," consisting of 17 "Strong Buy" ratings, two "Moderate Buy," and 11 "Holds" [5] Analyst Ratings - The current analyst configuration is slightly more bullish than three months ago, with 16 "Strong Buy" ratings [6] - On September 19, BMO Capital lowered Darden's price target to $205 while maintaining a "Market Perform" rating [6]

Core Insights - Darden Restaurants, Inc. is a major player in the North American full-service restaurant industry, with a market capitalization of $21.4 billion and a portfolio of well-known brands including Olive Garden and LongHorn Steakhouse [1] Financial Performance - Darden is expected to report an adjusted EPS of $2.10 for Q2, reflecting a 3.5% increase from $2.03 in the same quarter last year [2] - For the full fiscal year 2026, the adjusted EPS is projected to be $10.61, an 11.1% increase from $9.55 in 2025, with further growth expected in fiscal 2027 to $11.37 per share, a 7.2% year-over-year increase [3] Stock Performance - Darden's stock has increased by 11.8% over the past 52 weeks, which is lower than the Consumer Discretionary Select Sector SPDR Fund's 19.8% and the S&P 500 Index's 18.3% gains during the same period [4] Recent Developments - Following the release of mixed Q2 results, Darden's stock fell by 7.7%. The company reported a 4.7% year-over-year increase in same-store sales, driven by 5.9% growth at Olive Garden and 5.5% at LongHorn Steakhouse. Overall revenue grew 10.4% year-over-year to $3 billion, slightly exceeding consensus estimates [5] - Despite the revenue growth, Darden's profit margins were below expectations, resulting in an adjusted EPS of $1.97, which missed consensus estimates by 1.5% [6] Analyst Sentiment - Analysts maintain a consensus "Moderate Buy" rating for Darden, with 17 "Strong Buys," 2 "Moderate Buys," and 10 "Holds" among the 29 analysts covering the stock. The mean price target of $224.61 indicates a potential upside of 23.9% from current levels [6]

Core Insights - LRT Capital Management's "LRT Global Opportunities Strategy" reported a net return of -8.00% for September 2025 and a year-to-date return of -0.17%, indicating a challenging month due to market dynamics [1] - The strategy employs a systematic long/short approach to generate positive returns while managing downside risks and maintaining low net exposure to equity markets [1] Company Overview: Darden Restaurants, Inc. - Darden Restaurants, Inc. (NYSE:DRI) is recognized as a leading operator in the full-service dining industry, managing a portfolio of well-known brands, including Olive Garden [3] - The stock of Darden Restaurants, Inc. experienced a one-month return of -9.42% but gained 20.80% over the last 52 weeks, closing at $191.54 per share with a market capitalization of $22.279 billion on October 7, 2025 [2] - Darden's operational excellence, scale, and prudent capital allocation have established a strong competitive advantage and a sustainable platform for increasing shareholder value [3]

Core Insights - Darden Restaurants, known for Olive Garden, operates a total of 10 restaurant concepts, including LongHorn Steakhouse and Yard House, which diversifies its portfolio and enhances its market presence [1] Company Overview - Darden Restaurants is a significant player in the restaurant industry, owning multiple brands that cater to different dining preferences, thus providing a broad customer base [1] Investment Perspective - The company is viewed as a long-term investment opportunity, with a focus on growth potential and valuation metrics within the restaurant sector [1]

Group 1 - Darden Restaurants, Inc. (NYSE:DRI) experienced a mixed quarterly report, with results that were not entirely negative but affected by inflation leading to margin pressure [1] - The stock price declined from 208 to below 185, which some analysts believe is unjustified given the company's efforts to attract customers despite higher-than-expected costs [1] - Darden operates several well-known restaurant brands, including Olive Garden, Ruth's Chris Steak House, and LongHorn Steakhouse, among others [2]

Core Insights - Darden Restaurants, Inc. (NYSE:DRI) experienced a significant share price decline of 11.5% following its fiscal first-quarter earnings report, which missed analyst expectations for both earnings-per-share and revenue [2][3] - The company's earnings-per-share was reported at $1.97, while revenue was $3 billion, falling short of analyst estimates of $2 and $3.04 billion respectively [2] - Prior to the earnings report, Darden's shares had increased by over 12%, contrasting with the performance of other restaurant stocks [2] Company Performance - Jim Cramer highlighted the potential for Darden's flagship brand, Olive Garden, to recover, citing its strong margins despite recent challenges [3] - Cramer noted that the decline in share price was not due to a lack of customer demand, but rather rising food prices impacting consumer choices, particularly regarding steak [3] - The company is viewed as having potential for recovery, contingent on a decrease in food prices [3] Market Context - The discussion around Darden Restaurants also included a comparison to AI stocks, suggesting that while DRI has potential, some AI stocks may offer better returns with lower risk [3]

Core Viewpoint - Darden Restaurants' Q1 earnings report, while not exceeding expectations, still presents a bullish outlook for rising share prices, with a notable 10% share price reduction viewed as an opportunistic entry point for investors [1][2]. Financial Performance - Revenue grew by 8.7% due to acquisitions, an increase in organic store count, and positive comparable sales, despite falling short of analysts' consensus for revenue and earnings [6]. - Adjusted earnings reached $1.97, reflecting a 12.5% increase compared to slower top-line growth, indicating strong margin performance [7]. Analyst Sentiment - Initial analyst responses were favorable, with two revisions shortly after the earnings release maintaining previous ratings and price targets, forecasting a 20% upside post-sell-off [3]. - The consensus price target suggests a bullish bias, with increased coverage and a Moderate Buy rating trend [3]. Institutional Trends - Institutional ownership stands at 90%, with consistent buying trends observed every quarter this year, contributing over 6.7% to the market cap year-to-date [4]. Dividend and Capital Returns - Darden Restaurants offers a dividend yield of approximately 3.22%, with an annual dividend of $6.00 and a payout ratio of 67.57%, indicating a solid dividend increase track record over the past four years [6]. - The company is expected to continue share buybacks, enhancing shareholder returns through financial leverage [8][9]. Guidance and Market Outlook - The company updated its guidance to align with consensus forecasts, which is expected to support a higher share price [8]. - Current price action shows a 10% pullback, with support anticipated near $175, which aligns with previous highs and critical moving averages [10][11].

Company Overview - Darden Restaurants, Inc. (DRI) has a market cap of $22.5 billion and operates over 1,700 locations in North America under brands like Olive Garden and LongHorn Steakhouse [1][2] Stock Performance - Darden's shares have decreased 16.4% over the past three months, underperforming the Consumer Discretionary Select Sector SPDR Fund (XLY), which increased by 14.7% in the same period [3] - Year-to-date, DRI stock is down slightly, while XLY has risen by 7.6% [4] - Over the past 52 weeks, Darden's shares gained 8.1%, compared to XLY's 22.5% return [4] Recent Financial Results - In Q1 2026, Darden reported adjusted EPS of $1.97, missing Wall Street estimates, while quarterly sales of $3.04 billion met forecasts [5] - Operating costs surged by 8.8% to $2.71 billion, influenced by higher ingredient and marketing expenses [5] - Management raised its annual sales growth outlook to 7.5% - 8.5%, but the midpoint fell slightly below analysts' expectations, affecting investor sentiment [5] Competitive Landscape - Rival Yum! Brands, Inc. (YUM) has outperformed DRI, with shares increasing by 11.5% over the past 52 weeks and 8.9% year-to-date [6] - Despite Darden's underperformance, analysts maintain a "Moderate Buy" consensus rating, with a mean price target of $234.64, indicating a potential upside of 26.2% from current levels [6]

Core Viewpoint - Darden Restaurants Inc experienced a significant decline in stock price following the release of disappointing first-quarter results, despite some positive performance indicators from its Olive Garden brand [1][2]. Group 1: Financial Performance - Darden Restaurants reported mixed first-quarter results, with same-store sales growth of 4.7%, surpassing the consensus estimate of 4.4% [3]. - Traffic at Olive Garden and LongHorn increased by 3.6% and 3.2%, respectively, both exceeding the industry traffic growth of 2.6% [4]. Group 2: Analyst Insights - TD Cowen noted that the stock decline was influenced by high expectations for Olive Garden and recent share price appreciation, despite Olive Garden outperforming expectations for the second consecutive quarter, with the outperformance gap narrowing to 90 basis points [2]. - BTIG highlighted that Darden's strategy of under-pricing competitors is attracting consumers but may negatively impact profitability in the short term [4]. Group 3: Stock Ratings and Price Targets - TD Cowen analyst Andrew Charles maintained a Hold rating and reduced the price target from $235 to $200 [5]. - BTIG analyst Peter Saleh reiterated a Buy rating while lowering the price target from $235 to $225 [5].