Company Overview - Darden Restaurants, Inc. (DRI) has a market cap of approximately $25.1 billion and is one of the largest full-service restaurant operators in the U.S., known for brands like Olive Garden and LongHorn Steakhouse [1] Stock Performance - DRI stock has increased by 7.6% over the past year, underperforming the S&P 500 Index, which has risen by 14.4%. However, on a year-to-date basis, DRI shares are up 14.3%, significantly outperforming the S&P 500's 1.4% gain [2] - The company has also outperformed the State Street Consumer Discretionary Select Sector SPDR Fund (XLY), which returned 4.6% over the past 52 weeks [3] Strategic Decisions - On February 3, DRI shares rose by 2.3% following the announcement of the completion of a strategic review for its Bahama Breeze brand, which will involve the permanent closure of 14 locations and the conversion of the remaining 14 into other Darden concepts. These closures are expected to be finalized by April 5, 2026, with conversions occurring over the next 12–18 months. Management indicated that this move will not have a material financial impact and aims to strengthen other brands within its portfolio while supporting employees by placing them in other roles across Darden's network [4] Financial Projections - For the fiscal year ending in May 2026, analysts project DRI's adjusted EPS to grow by 10.7% year-over-year to $10.57. The company's earnings surprise history has been mixed, with one out of the last four quarters exceeding consensus estimates and three missing [5] - Among the 31 analysts covering DRI, the consensus rating is a "Moderate Buy," consisting of 19 "Strong Buy" ratings, one "Moderate Buy," and 11 "Holds" [5]

Group 1 - Darden Restaurants, Inc. is recognized as a leading operator in the full-service dining industry, managing well-known brands such as Olive Garden, Ruth's Chris Steak House, and others [2] - The company has established a competitive advantage through operational excellence, scale, and prudent capital allocation, positioning itself as a category-defining enterprise in the restaurant sector [2] - Olive Garden's performance has been highlighted positively, contributing to Darden's status as a "retail winner" in the current economic landscape [1] Group 2 - Darden's portfolio includes a diverse range of restaurant concepts, which enhances its market presence and appeal to various consumer segments [2] - The company is noted for its ability to compound shareholder value, indicating a strong focus on long-term growth and profitability [2]

Sales Performance - Darden Restaurants reported sales of $3.1 billion for Q2 FY2026, marking a 7.3% increase from the previous year [1] - Same-store sales grew by 4.3%, driven by strong performance across major brands, with Olive Garden and LongHorn Steakhouse reporting increases of 4.7% and 5.9% respectively [1] Financial Results - The company achieved a net income of $237.2 million in Q2 FY2026, or $2.03 per share, compared to $215.7 million or $1.82 per share in the same quarter last year [2] - On an adjusted basis, diluted earnings from continuing operations were $2.08 per share, excluding costs related to restaurant closures and the acquisition of Chuy's [2] Future Outlook - Darden raised its full-year same-restaurant sales growth forecast to a range of 3.5% to 4.3%, up from a previous estimate of 2.5% to 3.5% [3] - The guidance for adjusted diluted earnings per share for FY2026 remains unchanged at $10.50 to $10.70 [3] Operational Insights - Darden's president and CEO noted that all segments delivered positive same-restaurant sales, exceeding top-line expectations [4] - The company has been enhancing delivery options through a partnership with Uber, utilizing Uber Direct's network for nationwide on-demand delivery for Olive Garden [5] - An on-demand delivery trial with Uber Technologies was initiated at Cheddar's Scratch Kitchen in March [6]

Core Viewpoint - Darden Restaurants, Inc. is experiencing a cautious outlook from analysts, reflected in the declining price targets and mixed recommendations despite expectations of revenue growth from its popular brands [2][4][5]. Price Target Trends - The consensus price target for Darden's stock has decreased from $218.76 to $213.5 over the past year, indicating a cautious outlook from analysts [2][6]. - Credit Suisse analyst Lauren Siberman has set a conservative price target of $152, which aligns with the average 1-year target price reported by MarketBeat [3][6]. Analyst Recommendations - Darden has received an average recommendation of "Moderate Buy" from thirty brokerages, with eleven analysts rating the stock as a hold and nineteen giving it a buy rating, reflecting uncertainty surrounding the company's future performance [4][6]. Revenue Growth Expectations - The company's well-known brands, Olive Garden and LongHorn Steakhouse, are expected to drive revenue growth despite facing cost pressures, which investors should consider when evaluating Darden's stock [5].

Core Insights - Darden Restaurants, Inc. operates multiple well-known dining brands in North America, including Olive Garden and LongHorn Steakhouse, with a market capitalization of $20.83 billion [1] Stock Performance - Darden's stock reached a 52-week high of $228.27 in June but has since declined by 19.7%, with a 14.1% drop over the past three months, while the S&P 500 Index gained 4.8% during the same period [2] - Over the past 52 weeks, Darden's stock has gained 9.2%, but it has declined 15.8% over the past six months, contrasting with the S&P 500's gains of 13.4% and 14.6% respectively [4] Financial Results - For the first quarter of fiscal 2026, Darden reported sales of $3.04 billion, a 10.4% year-over-year increase, meeting market expectations, with same-restaurant sales up 4.7% [5] - The adjusted EPS for the quarter was $1.97, a 12.6% increase from the previous year, but it missed the Wall Street estimate of $2, leading to a 7.7% intraday stock drop on the earnings report date [6] - The company anticipates adjusted EPS for fiscal 2026 to be between $10.50 and $10.70 [6] Competitive Comparison - Darden has outperformed Yum! Brands, Inc. over the past 52 weeks, gaining 9.2% compared to Yum's 6.9%, but has underperformed over the past six months [7]

Core Insights - Darden Restaurants, Inc. plans to release its fiscal 2026 second quarter financial results on December 18, 2025, before the market opens [1] - A conference call will follow at 8:30 am ET, where CEO Rick Cardenas and senior management will discuss the results and answer questions [1] Company Overview - Darden Restaurants operates a diverse portfolio of restaurant brands, including Olive Garden, LongHorn Steakhouse, and Ruth's Chris Steak House, among others [1]

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]

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]

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 Insights - Darden Restaurants, Inc. reported first-quarter fiscal 2026 results with earnings missing estimates but revenues exceeding expectations, leading to an 8% decline in stock price during pre-market trading [1] Financial Performance - Adjusted earnings per share (EPS) for the fiscal first quarter were $1.97, below the Zacks Consensus Estimate of $2.00, compared to $1.75 in the prior-year quarter [2] - Total sales reached $3,044.7 million, surpassing the consensus mark of $3,040 million, reflecting a 10.4% increase from the previous year, supported by a 4.7% increase in same-restaurant sales [3] Segment Performance - Sales at Olive Garden increased 7.6% year over year to $1.3 billion, matching estimates, with same-restaurant sales up 5.9% [4] - LongHorn Steakhouse saw an 8.8% year-over-year sales increase to $776.4 million, though below the estimate of $811.5 million, with comps rising 5.5% [5] - Fine Dining segment sales rose 2.7% to $286.5 million, slightly above the estimate of $285 million, but comps fell 0.2% [5] - Other Business segment sales surged 22.5% year over year to $680.7 million, exceeding the estimate of $628.5 million, with comps up 3.3% [6] Operating Costs - Total operating costs and expenses increased 8.8% year over year to $2.7 billion, primarily due to higher food and beverage expenses, labor costs, and marketing expenses, missing the projection of $2.72 billion [7] Balance Sheet - As of August 24, 2025, cash and cash equivalents were $211 million, down from $240 million as of May 25, 2025, while inventories decreased slightly to $309.6 million [8] Future Outlook - For fiscal 2026, Darden raised its total sales growth outlook to 7.5% to 8.5%, including approximately 2% growth related to the 53rd week, with same-restaurant sales growth anticipated between 2.5% to 3.5% [11] - The company plans to open approximately 65 net new restaurants and allocate $700-$750 million for capital spending in fiscal 2026 [12]