Darden Restaurants Inc. (DRI) Stock Rating Upgraded by Zacks Investment Research
Darden Restaurants Inc. (NYSE:DRI) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a note issued to investors on Tuesday. The brokerage presently has a $83.00 target price on the restaurant operator’s stock. Zacks Investment Research’s price target would indicate a potential upside of 13.23% from the stock’s previous close.
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.”
A number of other analysts have also weighed in on DRI. Maxim Group lowered shares of Darden Restaurants from a “buy” rating to a “hold” rating and set a $74.00 price objective on the stock. in a research note on Monday. Credit Suisse Group AG lowered shares of Darden Restaurants from an “outperform” rating to a “neutral” rating and cut their price objective for the stock from $73.93 to $72.00 in a research note on Tuesday. They noted that the move was a valuation call. Piper Jaffray Cos. reiterated an “overweight” rating and issued a $76.00 price objective on shares of Darden Restaurants in a research note on Thursday, August 25th. Robert W. Baird reiterated a “neutral” rating on shares of Darden Restaurants in a research note on Thursday, September 8th. Finally, Oppenheimer Holdings Inc. reiterated an “outperform” rating and issued a $70.00 price objective on shares of Darden Restaurants in a research note on Wednesday, September 7th. Two analysts have rated the stock with a sell rating, fourteen have given a hold rating and ten have given a buy rating to the company’s stock. The stock presently has an average rating of “Hold” and a consensus price target of $70.79.
Shares of Darden Restaurants (NYSE:DRI) opened at 73.30 on Tuesday. The stock has a market cap of $9.02 billion, a PE ratio of 23.67 and a beta of 0.23. The firm has a 50-day moving average of $67.20 and a 200 day moving average of $64.39. 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 quarterly earnings results on Tuesday, October 4th. The restaurant operator reported $0.88 earnings per share (EPS) for the quarter, topping the Zacks’ consensus estimate of $0.82 by $0.06. The business earned $1.71 billion during the quarter. Darden Restaurants had a net margin of 5.73% and a return on equity of 24.97%. The company’s quarterly revenue was up 1.6% on a year-over-year basis. During the same period in the prior year, the business posted $0.68 EPS. On average, equities analysts forecast that Darden Restaurants will post $3.93 EPS for the current fiscal year.
The company also recently announced a quarterly dividend, which was paid on Tuesday, November 1st. Shareholders of record on Monday, October 10th were paid a dividend of $0.56 per share. This represents a $2.24 dividend on an annualized basis and a yield of 3.06%. The ex-dividend date was Wednesday, October 5th. Darden Restaurants’s dividend payout ratio (DPR) is presently 72.03%.
In other news, SVP Danielle L. Kirgan sold 28,127 shares of the business’s stock in a transaction that occurred on 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 sale, the senior vice president now directly owns 15,989 shares of the company’s stock, valued at approximately $998,832.83. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, SVP Danielle L. Kirgan sold 8,780 shares of the business’s stock in a transaction that occurred on 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 sale, the senior vice president now directly owns 15,989 shares in the company, valued at $998,832.83. The disclosure for this sale can be found here. Company insiders own 0.68% of the company’s stock.
Several large investors have recently added to or reduced their stakes in the stock. Schroder Investment Management Group increased its stake in 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 during the period. WBI Investments Inc. bought a new stake in Darden Restaurants during the second quarter worth about $57,165,000. Numeric Investors LLC increased its stake in 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 during the period. Bank of Montreal Can bought a new stake in Darden Restaurants during the second quarter worth about $53,974,000. Finally, Vanguard Group Inc. increased its stake in 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 during the period. 88.85% of the stock is currently 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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