The Darden Restaurants Inc. (DRI) Upgraded to “Buy” at The Zacks Investment Research

The Darden Restaurants Inc. (DRI) Upgraded to “Buy” at The Zacks Investment Research

Zacks Investment Research upgraded shares of Darden Restaurants Inc. (NYSE:DRI) from a hold rating to a buy rating in a research note issued to investors on Wednesday morning. Zacks Investment Research currently has $83.00 price target on the restaurant operator’s stock.

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 equities research analysts also recently issued reports on the company. Stifel Nicolaus downgraded Darden Restaurants from a hold rating to a sell rating and set a $53.00 price target on the stock. in a research report on Tuesday, July 26th. Piper Jaffray Cos. reissued an overweight rating and set a $76.00 price target on shares of Darden Restaurants in a research report on Thursday, August 25th. Robert W. Baird reissued a neutral rating on shares of Darden Restaurants in a research report on Thursday, September 8th. Oppenheimer Holdings Inc. reissued an outperform rating and set a $70.00 price target on shares of Darden Restaurants in a research report on Wednesday, September 7th. Finally, Raymond James Financial Inc. raised Darden Restaurants from an underperform rating to a market perform rating in a research report on Tuesday, October 18th. Two equities research analysts have rated the stock with a sell rating, thirteen have assigned a hold rating and eleven have issued a buy rating to the stock. Darden Restaurants has a consensus rating of Hold and a consensus price target of $70.63.

Shares of Darden Restaurants (NYSE:DRI) opened at 74.95 on Wednesday. Darden Restaurants has a 1-year low of $55.01 and a 1-year high of $74.99. The firm has a market capitalization of $9.22 billion, a PE ratio of 24.20 and a beta of 0.23. The stock has a 50 day moving average price of $66.24 and a 200 day moving average price of $64.18.

Darden Restaurants (NYSE:DRI) last posted its earnings results on Tuesday, October 4th. The restaurant operator reported $0.88 EPS for the quarter, beating the consensus estimate of $0.82 by $0.06. Darden Restaurants had a return on equity of 24.97% and a net margin of 5.73%. The company had revenue of $1.71 billion for the quarter. During the same period in the previous year, the company posted $0.68 EPS. Darden Restaurants’s revenue for the quarter was up 1.6% compared to the same quarter last year. Equities research analysts anticipate that Darden Restaurants will post $3.93 earnings per share for the current fiscal year.

The company also recently announced a quarterly dividend, which was paid on Tuesday, November 1st. Stockholders of record on Monday, October 10th were paid a $0.56 dividend. The ex-dividend date of this dividend was Wednesday, October 5th. This represents a $2.24 annualized dividend and a dividend yield of 2.99%. Darden Restaurants’s dividend payout ratio is presently 72.03%.

In other news, SVP Danielle L. Kirgan sold 28,127 shares of the firm’s stock in a transaction dated Monday, October 10th. The stock was sold at an average price of $62.47, for a total value of $1,757,093.69. Following the completion of the sale, the senior vice president now directly owns 15,989 shares in the company, valued at approximately $998,832.83. The sale was disclosed in a document filed with the SEC, which is accessible through this link. Also, SVP Danielle L. Kirgan sold 8,780 shares of the firm’s stock in a transaction dated Tuesday, October 11th. The shares were sold at an average price of $62.47, for a total value of $548,486.60. Following the completion of the sale, the senior vice president now owns 15,989 shares of the company’s stock, valued at $998,832.83. The disclosure for this sale can be found here. 0.69% of the stock is owned by insiders.

Several hedge funds have recently modified their holdings of the stock. Franklin Street Advisors Inc. NC increased its stake in shares of Darden Restaurants by 28.5% in the second quarter. Franklin Street Advisors Inc. NC now owns 59,980 shares of the restaurant operator’s stock valued at $3,799,000 after buying an additional 13,293 shares in the last quarter. GW&K Investment Management LLC boosted its position in shares of Darden Restaurants by 6.6% in the second quarter. GW&K Investment Management LLC now owns 381,922 shares of the restaurant operator’s stock valued at $24,191,000 after buying an additional 23,780 shares during the last quarter. Gulf International Bank UK Ltd boosted its position in shares of Darden Restaurants by 2.6% in the second quarter. Gulf International Bank UK Ltd now owns 36,924 shares of the restaurant operator’s stock valued at $2,338,000 after buying an additional 950 shares during the last quarter. Exxonmobil Investment Management Inc. TX boosted its position in shares of Darden Restaurants by 5.1% in the second quarter. Exxonmobil Investment Management Inc. TX now owns 29,523 shares of the restaurant operator’s stock valued at $1,870,000 after buying an additional 1,423 shares during the last quarter. Finally, British Columbia Investment Management Corp boosted its position in shares of Darden Restaurants by 5.8% in the second quarter. British Columbia Investment Management Corp now owns 111,649 shares of the restaurant operator’s stock valued at $7,072,000 after buying an additional 6,128 shares during the last quarter. Institutional investors own 88.85% of the company’s stock.

Darden Restaurants Company Profile

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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