Darden Restaurants PT Raised to $54.00 at Wunderlich (DRI)
Equities research analysts at Wunderlich boosted their price objective on shares of Darden Restaurants (NYSE:DRI) from $50.00 to $54.00 in a research note issued to investors on Tuesday, Stock Ratings Network.com reports. The firm currently has a “hold” rating on the stock. Wunderlich’s target price would indicate a potential downside of 0.64% from the stock’s previous close.
The analysts wrote, “We reiterate our Hold rating on Darden (DRI) following its weaker-than-expected Q2F14 (Nov) results and risk of further volatility to come. Along with its earnings release, management announced a plan to separate its struggling Red Lobster division through a sale or shareholder spin-off. Despite that, activists are saber-rattling for greater change including separation of its struggling brands (Red Lobster, Olive Garden) from its growth-oriented Specialty Restaurant Group (SRG), and establishing a REIT for its properties. Given the distractions of further change and volatility in its core businesses, we caution that our revised, lowered projections could vary materially. We are modestly lifting our PT to $54.00 from $50.00; we reiterate our Hold rating given Darden’s volatile operating trends.” Some highlights from the report included: -”Along with Darden’s weak fiscal Q214 (Nov) results, management announced an aggressive plan designed to: 1) separate its struggling Red Lobster division through sale or spin-off; 2) pare back development, acquisitions and capex spending; 3) enact further cost-saving initiatives and mngt. compensation; and 4) maintain its quarterly dividend. -”Activists Barrington Capital (2.8%) and Starboard Value (5.6%) have taken positions in DRI and argue that management’s plan doesn’t go far enough to improve shareholder value.” -”While DRI could drift higher on optimistic valuation exercises, we resist chasing DRI on our belief that pending a sustained lift in “profitable SSS” for both OG and RL, sustaining those levels could prove elusive.”
Darden Restaurants (NYSE:DRI) traded down 0.09% during mid-day trading on Tuesday, hitting $54.30. The stock had a trading volume of 609,845 shares. Darden Restaurants has a 52 week low of $44.11 and a 52 week high of $55.25. The stock has a 50-day moving average of $52.54 and a 200-day moving average of $50.21. The company has a market cap of $7.092 billion and a price-to-earnings ratio of 20.05.
Darden Restaurants (NYSE:DRI) last posted its quarterly earnings results on Thursday, December 19th. The company reported $0.15 EPS for the quarter, missing the Thomson Reuters consensus estimate of $0.21 by $0.06. The company had revenue of $2.05 billion for the quarter, compared to the consensus estimate of $2.07 billion. During the same quarter in the prior year, the company posted $0.26 earnings per share. The company’s quarterly revenue was up 4.6% on a year-over-year basis. On average, analysts predict that Darden Restaurants will post $2.67 earnings per share for the current fiscal year.
The company also recently announced a quarterly dividend, which is scheduled for Monday, February 3rd. Stockholders of record on Friday, January 10th will be paid a dividend of 0.55 per share. This represents a $2.20 annualized dividend and a dividend yield of 4.05%. The ex-dividend date is Wednesday, January 8th.
Other equities research analysts have also recently issued reports about the stock. Analysts at Zacks reiterated a “neutral” rating on shares of Darden Restaurants in a research note to investors on Friday. They now have a $54.00 price target on the stock. Separately, analysts at UBS AG raised their price target on shares of Darden Restaurants from $15.00 to $47.00 in a research note to investors on Friday. They now have a “sell” rating on the stock. Finally, analysts at Telsey Advisory Group cut their price target on shares of Darden Restaurants from $49.00 to $45.00 in a research note to investors on Friday. They now have a “not rated” rating on the stock. Three analysts have rated the stock with a sell rating, seventeen have issued a hold rating and six have given a buy rating to the company. The company currently has an average rating of “Hold” and a consensus target price of $50.86.
Darden Restaurants, Inc (NYSE:DRI) is a company owned and full-service restaurant company.
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