According to Zacks, “Shares of Darden have outperformed the industry in a year. Darden’s earnings met/surpassed the Zacks Consensus Estimate for 18 straight quarters. Estimates for current quarter and year have increased over the past 60 days. Backed by its various sales initiatives and technology-driven moves, the top line is likely to improve in the months ahead. The company’s efforts to check costs are commendable. In fiscal 2018, management realized roughly $10 million of cost synergies and expects to realize the same in the range of $22-$27 million by the end of fiscal 2019. Further, the Cheddar's buyout has added value to Darden's portfolio of differentiated brands. Current-year earnings estimates have also moved north over the past month. However, fierce competition and softer-than-expected consumer demand might keep comps under pressure. Also, rising labor costs and a non-franchised business model may dampen profits.”
Other research analysts also recently issued research reports about the stock. Wells Fargo & Co raised their price target on shares of Darden Restaurants from $110.00 to $120.00 and gave the stock a market perform rating in a research note on Friday, March 22nd. Mizuho raised their price target on shares of Darden Restaurants from $125.00 to $130.00 and gave the stock a buy rating in a research note on Friday, March 22nd. Morgan Stanley raised their price target on shares of Darden Restaurants from $112.00 to $121.00 and gave the stock an equal weight rating in a research note on Friday, March 22nd. Citigroup raised their price target on shares of Darden Restaurants from $120.00 to $146.00 and gave the stock a buy rating in a research note on Wednesday, April 3rd. Finally, SunTrust Banks raised their price target on shares of Darden Restaurants to $141.00 and gave the stock a buy rating in a research note on Friday, March 22nd. One equities research analyst has rated the stock with a sell rating, seven have given a hold rating and eighteen have assigned a buy rating to the stock. The company has an average rating of Buy and a consensus price target of $129.38.
Darden Restaurants (NYSE:DRI) last announced its earnings results on Thursday, March 21st. The restaurant operator reported $1.80 earnings per share for the quarter, beating the Thomson Reuters’ consensus estimate of $1.75 by $0.05. Darden Restaurants had a net margin of 8.08% and a return on equity of 30.28%. The business had revenue of $2.25 billion for the quarter, compared to the consensus estimate of $2.24 billion. During the same quarter in the prior year, the firm posted $1.71 earnings per share. The business’s revenue for the quarter was up 5.5% on a year-over-year basis. On average, equities research analysts predict that Darden Restaurants will post 5.78 earnings per share for the current year.
The firm also recently announced a quarterly dividend, which was paid on Wednesday, May 1st. Shareholders of record on Wednesday, April 10th were issued a dividend of $0.75 per share. This represents a $3.00 annualized dividend and a yield of 2.52%. The ex-dividend date of this dividend was Tuesday, April 9th. Darden Restaurants’s payout ratio is 62.37%.
In other Darden Restaurants news, SVP John W. Madonna sold 330 shares of the stock in a transaction dated Monday, March 25th. The shares were sold at an average price of $118.76, for a total transaction of $39,190.80. Following the transaction, the senior vice president now directly owns 1,680 shares in the company, valued at approximately $199,516.80. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, insider Eugene I. Lee, Jr. sold 73,152 shares of the firm’s stock in a transaction dated Monday, March 25th. The shares were sold at an average price of $118.61, for a total transaction of $8,676,558.72. Following the completion of the sale, the insider now owns 190,025 shares in the company, valued at $22,538,865.25. The disclosure for this sale can be found here. 0.65% of the stock is owned by corporate insiders.
Large investors have recently added to or reduced their stakes in the company. BlueMountain Capital Management LLC purchased a new position in shares of Darden Restaurants in the 1st quarter valued at approximately $12,723,000. Covenant Partners LLC purchased a new position in shares of Darden Restaurants in the 1st quarter valued at approximately $210,000. HighTower Advisors LLC raised its position in shares of Darden Restaurants by 7.4% in the 1st quarter. HighTower Advisors LLC now owns 19,267 shares of the restaurant operator’s stock valued at $2,340,000 after purchasing an additional 1,325 shares during the last quarter. Baker Avenue Asset Management LP purchased a new position in shares of Darden Restaurants in the 1st quarter valued at approximately $1,707,000. Finally, Ladenburg Thalmann Financial Services Inc. raised its position in shares of Darden Restaurants by 20.4% in the 1st quarter. Ladenburg Thalmann Financial Services Inc. now owns 11,461 shares of the restaurant operator’s stock valued at $1,391,000 after purchasing an additional 1,938 shares during the last quarter. Institutional investors and hedge funds own 91.35% of the company’s stock.
Darden Restaurants Company Profile
Darden Restaurants, Inc, through its subsidiaries, owns and operates full-service restaurants in the United States and Canada. As of May 27, 2018, it owned and operated approximately 1,746 restaurants under the Olive Garden, LongHorn Steakhouse, Cheddar's Scratch Kitchen, Yard House, The Capital Grille, Bahama Breeze, Seasons 52, and Eddie V's brands.
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