Darden Restaurants, Inc. is based in Orlando, Florida. 
DRI owns and operates full-service restaurants in North America. With a market capitalization of $17.1 billion, Darden Restaurants operates various brands including Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen, Seasons 52, Capital Burger and more.
The restaurant giant has significantly underperformed the broader market over the past year. Over the past 52 weeks, the DRI fell 5.6% compared to the 28.3% return of the S&P 500 Index ($SPX). In 2024 alone, the DRI fell 8.9% compared to the SPX’s 17.6% annualized gains.
When narrowing the focus, DRI also lagged behind the Advisorshares Restaurant ETFs. 
EATZ 23.6% return over the last 52 weeks and 10.9% gain year to date.
Darden Restaurants shares rose 1.5% after reporting fiscal 2024 results on June 20. The company’s revenue rose 8.6% annually to $11.4 billion and net income rose 4.7% to $1 billion. In addition, the company plans to open 45 to 50 new restaurants in 2025.
For the fiscal year ending May 2025, analysts expect Darden Restaurants to report a 6.8% year-over-year increase in earnings to $9.48. The company’s earnings surprises are mixed. In three of the last four quarters, it beat consensus earnings per share estimates, while missing estimates on another occasion. Its earnings per share for the most recently reported quarter of $2.65 beat consensus estimates by 1.2%.
The 25 analysts covering DRI stock have a consensus rating of “Moderate Buy.” This is based on 15 “Strong Buy” ratings, two “Moderate Buys,” seven “Holds,” and one “Moderate Sell” rating.
This constellation is somewhat less optimistic than two months ago: 16 analysts recommend a “strong buy” and none recommend a “moderate sell”.
On July 23, TD Cowen analyst Andrew Charles downgraded the stock to hold with a $150 price target, citing a combination of factors affecting the company’s future prospects, including the lack of significant growth and unclear revenue drivers in an increasingly sophisticated full-service restaurant industry.
DRI’s median price target of $170.92 represents a 14.2% premium to current price levels. The Street-high target of $192 suggests a potential upside of 28.3%.
As of the date of publication, Aditya Sarawgi had no position (either directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. For more information, please see Barchart’s disclosure policy here.
