Darden Restaurants Inc. (DRI) Lowered to Hold at Zacks Investment Research
According to Zacks, “Most of Darden’s brands have been witnessing growth over the past few quarters on the back of sales initiatives like simplifying kitchen systems, improving in-restaurant execution to enhance guest experience menu innovation and technology-driven moves. Moreover, the company’s Olive Garden Brand Renaissance plan – aimed to turn around its business – has started reaping benefits. Also, the company’s efforts to check costs are commendable. Backed by these positives, Darden’s first-quarter fiscal 2017 earnings beat the Zacks Consensus Estimate for the eighth consecutive quarter. The company also raised its guidance for fiscal 2017 earnings. Meanwhile, initiatives undertaken to attract guests at LongHorn and other units also bode well. However, rising labor costs and a non-franchised business model might dampen the company’s profits, while a soft consumer spending environment could keep comps under pressure.”
Other equities research analysts also recently issued reports about the stock. Canaccord Genuity started coverage on shares of Darden Restaurants in a research note on Monday, August 22nd. They issued a buy rating and a $74.00 price target on the stock. SunTrust Banks Inc. reduced their price target on shares of Darden Restaurants from $70.00 to $67.00 and set a neutral rating on the stock in a research note on Wednesday, October 5th. Robert W. Baird reissued a neutral rating on shares of Darden Restaurants in a research note on Thursday, September 8th. Stifel Nicolaus reduced their price target on shares of Darden Restaurants from $53.00 to $50.00 and set a sell rating on the stock in a research note on Monday, October 3rd. Finally, BMO Capital Markets reissued a hold rating and issued a $64.00 price target on shares of Darden Restaurants in a research note on Thursday, September 1st. Two analysts have rated the stock with a sell rating, fourteen have issued a hold rating and ten have issued a buy rating to the stock. The stock currently has an average rating of Hold and a consensus target price of $70.63.
Shares of Darden Restaurants (NYSE:DRI) opened at 74.95 on Friday. The firm has a market capitalization of $9.22 billion, a P/E ratio of 24.20 and a beta of 0.23. The firm has a 50-day moving average of $66.24 and a 200 day moving average of $64.18. Darden Restaurants has a 52 week low of $55.01 and a 52 week high of $74.99.
Darden Restaurants (NYSE:DRI) last posted its earnings results on Tuesday, October 4th. The restaurant operator reported $0.88 earnings per share for the quarter, beating the consensus estimate of $0.82 by $0.06. The company had revenue of $1.71 billion for the quarter. Darden Restaurants had a net margin of 5.73% and a return on equity of 24.97%. The business’s revenue for the quarter was up 1.6% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $0.68 earnings per share. On average, equities research analysts expect that Darden Restaurants will post $3.93 EPS for the current fiscal year.
The company also recently disclosed a quarterly dividend, which was paid on Tuesday, November 1st. Shareholders of record on Monday, October 10th were given a dividend of $0.56 per share. The ex-dividend date was Wednesday, October 5th. This represents a $2.24 dividend on an annualized basis and a yield of 2.99%. Darden Restaurants’s payout ratio is currently 72.03%.
In other news, SVP Danielle L. Kirgan sold 28,127 shares of the stock in a transaction dated Monday, October 10th. The shares were sold at an average price of $62.47, for a total value of $1,757,093.69. Following the completion of the transaction, the senior vice president now owns 15,989 shares in the company, valued at approximately $998,832.83. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, SVP Danielle L. Kirgan sold 8,780 shares of the stock in a transaction dated Tuesday, October 11th. The shares were sold at an average price of $62.47, for a total transaction of $548,486.60. Following the completion of the transaction, the senior vice president now owns 15,989 shares of the company’s stock, valued at approximately $998,832.83. The disclosure for this sale can be found here. Company insiders own 0.69% of the company’s stock.
Several institutional investors have recently made changes to their positions in the stock. Schroder Investment Management Group increased its position in shares of Darden Restaurants by 291.5% in the second quarter. Schroder Investment Management Group now owns 1,725,904 shares of the restaurant operator’s stock worth $109,319,000 after buying an additional 1,285,004 shares in the last quarter. WBI Investments Inc. bought a new position in shares of Darden Restaurants during the second quarter worth about $57,165,000. Numeric Investors LLC increased its position in shares of Darden Restaurants by 228.9% in the second quarter. Numeric Investors LLC now owns 1,272,100 shares of the restaurant operator’s stock worth $80,575,000 after buying an additional 885,300 shares in the last quarter. Bank of Montreal Can bought a new position in shares of Darden Restaurants during the second quarter worth about $53,974,000. Finally, Vanguard Group Inc. increased its position in shares of Darden Restaurants by 5.3% in the second quarter. Vanguard Group Inc. now owns 12,676,075 shares of the restaurant operator’s stock worth $802,903,000 after buying an additional 640,845 shares in the last quarter. Institutional investors and hedge funds own 88.85% of the company’s stock.
About Darden Restaurants
Darden Restaurants, Inc is a full-service restaurant company. The Company owned and operated 1,536 restaurants through its subsidiaries in the United States and Canada, as of May 29, 2016. The Company’s segments include Olive Garden, LongHorn Steakhouse, Fine Dining (which includes The Capital Grille, and Eddie V’s Prime Seafood and Wildfish Seafood Grille (Eddie V’s)) and Other Business (which includes Yard House, Seasons 52, Bahama Breeze, consumer-packaged goods and franchise revenues).
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