Zacks Investment Research Downgrades Darden Restaurants, Inc. (DRI) to Sell
Darden Restaurants, Inc. (NYSE:DRI) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a note issued to investors on Tuesday.
According to Zacks, “Darden posted solid first-quarter fiscal 2018 results with the bottom and the top line surpassing the Zacks Consensus Estimate. In fact, the reported quarter marked the 12th successive earnings beat for the company. Going forward, various sales initiatives and technology-driven moves are expected to boost the top line. Additionally, efforts to attract guests at Olive Garden, LongHorn and other units, along with the cost saving measures are encouraging. However, Darden’s shares underperformed its industry in the past six months. A soft consumer spending environment might keep comps under pressure, while rising labor costs and a non-franchised business model are likely to dampen the company’s profits, moving ahead.”
DRI has been the subject of several other reports. Royal Bank Of Canada reduced their target price on Darden Restaurants from $96.00 to $90.00 and set a “sector perform” rating for the company in a research note on Wednesday, September 27th. Robert W. Baird reiterated a “neutral” rating and set a $94.00 target price (up from $90.00) on shares of Darden Restaurants in a research note on Wednesday, June 28th. Raymond James Financial, Inc. reiterated a “market perform” rating on shares of Darden Restaurants in a research note on Monday, July 24th. Oppenheimer Holdings, Inc. reissued a “buy” rating and set a $100.00 price target on shares of Darden Restaurants in a research report on Wednesday, September 20th. Finally, Jefferies Group LLC reissued a “hold” rating and set a $82.00 price target (down from $90.00) on shares of Darden Restaurants in a research report on Wednesday, September 27th. Two equities research analysts have rated the stock with a sell rating, seventeen have issued a hold rating and nine have given a buy rating to the company. The company presently has an average rating of “Hold” and an average target price of $87.82.
Darden Restaurants (NYSE DRI) traded up 1.42% during mid-day trading on Tuesday, reaching $81.34. 1,674,747 shares of the company’s stock were exchanged. The company has a market capitalization of $10.06 billion, a P/E ratio of 21.06 and a beta of 0.25. The company’s 50 day moving average price is $80.96 and its 200-day moving average price is $85.33. Darden Restaurants has a 52 week low of $60.97 and a 52 week high of $95.22.
Darden Restaurants (NYSE:DRI) last released 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. The company had revenue of $1.94 billion during the quarter, compared to analysts’ expectations of $1.93 billion. Darden Restaurants had a return on equity of 23.39% and a net margin of 6.27%. The business’s revenue was up 12.9% on a year-over-year basis. During the same period in the prior year, the business posted $0.88 EPS. On average, equities research analysts expect that Darden Restaurants will post $4.45 earnings per share for the current fiscal year.
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Institutional investors and hedge funds have recently modified their holdings of the company. M&R Capital Management Inc. acquired a new position in shares of Darden Restaurants during the second quarter valued at $108,000. D.A. Davidson & CO. increased its holdings in shares of Darden Restaurants by 1.7% during the second quarter. D.A. Davidson & CO. now owns 1,271 shares of the restaurant operator’s stock valued at $114,000 after purchasing an additional 21 shares during the period. Farmers & Merchants Investments Inc. increased its holdings in shares of Darden Restaurants by 255.5% during the second quarter. Farmers & Merchants Investments Inc. now owns 1,422 shares of the restaurant operator’s stock valued at $129,000 after purchasing an additional 1,022 shares during the period. Huntington National Bank increased its holdings in shares of Darden Restaurants by 4.6% during the second quarter. Huntington National Bank now owns 1,578 shares of the restaurant operator’s stock valued at $143,000 after purchasing an additional 70 shares during the period. Finally, Ledyard National Bank increased its holdings in shares of Darden Restaurants by 4.9% during the second quarter. Ledyard National Bank now owns 1,718 shares of the restaurant operator’s stock valued at $155,000 after purchasing an additional 80 shares during the period. 89.56% of the stock is currently owned by institutional investors.
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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