Zacks Investment Research upgraded shares of Darden Restaurants Inc. (NYSE:DRI) from a hold rating to a buy rating in a report released on Thursday morning. Zacks Investment Research currently has $69.00 target price on the restaurant operator’s stock.
According to Zacks, “Darden posted mixed first-quarter fiscal 2017 results wherein though the bottom line beat the Zacks Consensus Estimate, the top line lagged the same. Notably, this quarter marked the eighth consecutive earnings beat for the company. The company also raised its guidance for fiscal 2017 earnings and witnessed a rise in sales across all its segments in the first quarter. Going forward, sales initiatives like simplifying kitchen systems, improving in-restaurant execution to enhance guest experience, menu innovation and technology-driven moves should boost the top line. Moreover, the company’s Olive Garden Brand Renaissance plan – aimed to turn around its business – has started reaping benefits. Also, Darden’s efforts to check costs are commendable. 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.”
DRI has been the topic of several other research reports. SunTrust Banks Inc. dropped their price objective on Darden Restaurants from $70.00 to $67.00 and set a neutral rating on the stock in a research note on Wednesday, October 5th. Bank of America Corp. reissued a sell rating on shares of Darden Restaurants in a research note on Wednesday, October 5th. Credit Suisse Group AG reissued a buy rating and issued a $69.00 price objective on shares of Darden Restaurants in a research note on Wednesday, October 5th. Stifel Nicolaus dropped their price objective on Darden Restaurants from $53.00 to $50.00 and set a sell rating on the stock in a research note on Monday, October 3rd. Finally, RBC Capital Markets reissued a sector perform rating and issued a $70.00 price objective on shares of Darden Restaurants in a research note on Friday, September 30th. Three investment analysts have rated the stock with a sell rating, eleven have assigned a hold rating and twelve have issued a buy rating to the stock. The stock has an average rating of Hold and a consensus price target of $69.89.
Shares of Darden Restaurants (NYSE:DRI) opened at 62.40 on Thursday. Darden Restaurants has a 12 month low of $53.38 and a 12 month high of $68.68. The company has a market capitalization of $7.68 billion, a price-to-earnings ratio of 20.15 and a beta of 0.41. The stock has a 50 day moving average price of $61.93 and a 200-day moving average price of $63.69.
Darden Restaurants (NYSE:DRI) last issued its quarterly earnings results on Tuesday, October 4th. The restaurant operator reported $0.88 earnings per share for the quarter, topping 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 firm had revenue of $1.71 billion for the quarter. During the same quarter in the previous year, the company posted $0.68 earnings per share. The company’s quarterly revenue was up 1.6% compared to the same quarter last year. Analysts expect that Darden Restaurants will post $3.92 earnings per share for the current fiscal year.
The firm also recently announced a quarterly dividend, which will be paid on Tuesday, November 1st. Stockholders of record on Monday, October 10th will be given a dividend of $0.56 per share. This represents a $2.24 dividend on an annualized basis and a dividend yield of 3.59%. The ex-dividend date is Wednesday, October 5th. Darden Restaurants’s dividend payout ratio (DPR) is presently 72.03%.
Several large investors have recently bought and sold shares of DRI. Vanguard Group Inc. boosted 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. State Street Corp boosted its stake in Darden Restaurants by 0.6% in the first quarter. State Street Corp now owns 5,228,348 shares of the restaurant operator’s stock worth $346,649,000 after buying an additional 32,258 shares during the period. BlackRock Fund Advisors boosted its stake in Darden Restaurants by 12.2% in the second quarter. BlackRock Fund Advisors now owns 4,646,824 shares of the restaurant operator’s stock worth $294,330,000 after buying an additional 505,377 shares during the period. Bank of New York Mellon Corp boosted its stake in Darden Restaurants by 8.6% in the second quarter. Bank of New York Mellon Corp now owns 3,902,816 shares of the restaurant operator’s stock worth $247,202,000 after buying an additional 308,834 shares during the period. Finally, Ameriprise Financial Inc. boosted its stake in Darden Restaurants by 16.3% in the second quarter. Ameriprise Financial Inc. now owns 3,893,719 shares of the restaurant operator’s stock worth $246,621,000 after buying an additional 544,413 shares during the period. Hedge funds and other institutional investors own 94.57% of the company’s stock.
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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