Darden Restaurants, Inc. (DRI) Lifted to “Outperform” at Robert W. Baird
Robert W. Baird upgraded shares of Darden Restaurants, Inc. (NYSE:DRI) from a neutral rating to an outperform rating in a research note published on Wednesday morning, Marketbeat.com reports. They currently have $94.00 target price on the restaurant operator’s stock.
“compelling entry point.” The firm’s David Tarantino upgrades Darden’s stock rating from Neutral to Outperform with an unchanged $94 price target.Darden’s stock has lost more than 15 percent over the past three months, which makes its current valuation more attractive, Tarantino explained in his upgrade note. Specifically, the stock’s current next-twelve-months (NTM) EV/EBITDA and P/E multiples are sitting 4–9 percent below their respective one year averages.While many investors are likely concerned with Darden’s same-store sales outlook in the struggling casual dining industry, the company is well positioned to deliver above-average performance, the analyst noted. In fact, Darden can perform well in the restaurant sector even if overall industry trends don’t improve — although it would likely imply upside to estimates.Meanwhile, management remains focused on simplifying its operations, which lead to a better service and execution and also improve the value proposition of its brands through scale advantages and quality upgrades.”We believe further evidence of solid top- and bottom-line fundamentals in upcoming periods can lead to improved investor sentiment and support a return to higher valuation metrics on the shares following the recent pullback,,” Robert W. Baird’s analyst commented.
Several other equities research analysts also recently commented on the stock. Stephens reaffirmed an equal weight rating and issued a $95.00 target price on shares of Darden Restaurants in a research note on Tuesday. Royal Bank Of Canada reaffirmed a sector perform rating and issued a $90.00 target price (down previously from $96.00) on shares of Darden Restaurants in a research note on Friday, September 22nd. Maxim Group reaffirmed a hold rating and issued a $90.00 target price on shares of Darden Restaurants in a research note on Thursday, September 21st. Zacks Investment Research raised shares of Darden Restaurants from a hold rating to a buy rating and set a $94.00 target price for the company in a research note on Friday, September 22nd. Finally, Oppenheimer Holdings, Inc. reaffirmed a buy rating and issued a $100.00 target price on shares of Darden Restaurants in a research note on Wednesday, September 20th. Two analysts have rated the stock with a sell rating, fifteen have assigned a hold rating and ten have given a buy rating to the company. The company has a consensus rating of Hold and a consensus price target of $84.86.
Darden Restaurants (NYSE DRI) traded down 0.23% during trading on Wednesday, reaching $78.78. 2,144,813 shares of the company’s stock traded hands. The company has a market cap of $9.86 billion, a P/E ratio of 20.40 and a beta of 0.27. The firm’s 50 day moving average is $82.69 and its 200 day moving average is $84.83. Darden Restaurants has a 12 month low of $60.16 and a 12 month high of $95.22.
Darden Restaurants (NYSE:DRI) last issued its earnings results on Tuesday, September 26th. The restaurant operator reported $0.99 EPS for the quarter, meeting the Thomson Reuters’ consensus estimate of $0.99. Darden Restaurants had a net margin of 6.60% and a return on equity of 26.06%. The firm had revenue of $1.94 billion during the quarter, compared to the consensus estimate of $1.93 billion. During the same quarter in the prior year, the firm earned $0.88 earnings per share. The business’s quarterly revenue was up 12.9% on a year-over-year basis. Analysts anticipate that Darden Restaurants will post $4.45 EPS for the current year.
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The firm also recently announced a quarterly dividend, which will be paid on Wednesday, November 1st. Investors of record on Tuesday, October 10th will be given a $0.63 dividend. This represents a $2.52 dividend on an annualized basis and a yield of 3.20%. The ex-dividend date is Friday, October 6th. Darden Restaurants’s dividend payout ratio (DPR) is currently 65.12%.
A number of institutional investors have recently added to or reduced their stakes in DRI. M&R Capital Management Inc. acquired a new stake in Darden Restaurants in the second quarter valued at $108,000. D.A. Davidson & CO. lifted its stake in Darden Restaurants by 1.7% in the second quarter. D.A. Davidson & CO. now owns 1,271 shares of the restaurant operator’s stock valued at $114,000 after acquiring an additional 21 shares during the last quarter. Farmers & Merchants Investments Inc. lifted its stake in Darden Restaurants by 255.5% in the second quarter. Farmers & Merchants Investments Inc. now owns 1,422 shares of the restaurant operator’s stock valued at $129,000 after acquiring an additional 1,022 shares during the last quarter. Van ECK Associates Corp lifted its stake in Darden Restaurants by 4.6% in the first quarter. Van ECK Associates Corp now owns 1,625 shares of the restaurant operator’s stock valued at $136,000 after acquiring an additional 71 shares during the last quarter. Finally, Huntington National Bank lifted its stake in Darden Restaurants by 4.6% in the second quarter. Huntington National Bank now owns 1,578 shares of the restaurant operator’s stock valued at $143,000 after acquiring an additional 70 shares during the last quarter. 88.65% of the stock is owned by institutional investors and hedge funds.
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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