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Darden (DRI) Tops Q4 Earnings on Sales Growth, Ups Dividend
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Darden Restaurants, Inc. (DRI - Free Report) reported fourth-quarter fiscal 2017 adjusted earnings of $1.18 per share, beating the Zacks Consensus Estimate of $1.15 by 2.6%. Further, earnings increased 7.3% year over year on the back of higher revenues and lower share count. Notably, this quarter marked the eleventh consecutive earnings beat for the company.
Meanwhile, total revenue of $1.93 billion surpassed the Zacks Consensus Estimate of $1.86 billion by 3.8% and increased 8.1% year over year.
Behind the Headline Numbers
Since the beginning of fourth-quarter fiscal 2015, Darden started reporting under four new segments: Olive Garden, LongHorn Steakhouse, Fine Dining that includes The Capital Grille and Eddie V's, and Other Business. The Other Business segment includes Yard House, Seasons 52, Bahama Breeze, consumer packaged goods, and franchise revenues.
The company posted comps growth of 3.3% in the quarter, on a fiscal calendar basis. Notably, it was stronger than the comps growth of 0.9% in the preceding quarter. Meanwhile, the company witnessed an increase in sales across all its brands in the fiscal fourth quarter.
Sales at Olive Garden were up 4.6% year over year to $1.03 billion. A 4.4% increase in comps at this segment was higher than prior-quarter comps growth of 1.4%. Traffic grew 2%, while there was a 1.7% improvement in pricing and 0.7% growth in menu mix.
Sales at Fine Dining increased 5.7% to $139.1 million. Comps at The Capital Grille rose 0.5%, lower than the prior-quarter comps growth of 0.9%. Meanwhile, Eddie V's posted comps growth of 3.3%, lower than the 4.7% improvement recorded in the preceding quarter.
Revenues from Other Business jumped 25.8% year over year to $331.6 million. But comps at Seasons 52 declined 1.3% for the quarter, as against the prior-quarter comps’ growth of 0.8%. Meanwhile, comps grew 1.4% at Bahama Breeze, higher than the comps growth of 0.5% in the preceding quarter. Moreover, comps at Yard House inched up 0.1% for the quarter against a 1% dip recorded in the last quarter.
At LongHorn Steakhouse, sales rose 5.7% to $436.6 million. Comps at LongHorn Steakhouse increased 3.5%, higher than the prior-quarter comps growth of 0.2%. Traffic increased 2.1%, while pricing and menu mix grew 1.3% and 0.1%, respectively.
Fiscal 2017 Results
Adjusted earnings per share in fiscal 2017 were $4.02, ahead of the Zacks Consensus Estimate of $3.99. Moreover, adjusted earnings per share surged 13.9% year over year.
Total revenue of $7.17 billion increased 3.4% year over year and topped the consensus mark of $7.09 billion.
Dividend Hike
The board of directors announced a 12.5% increase in the quarterly dividend from 56 cents to 63 cents per share, payable on Aug 1, 2017, to shareholders of record as of Jul 10, 2017. This adds up to an annual dividend of $2.24, representing a dividend yield of nearly 3%.
Darden Restaurants, Inc. Price, Consensus and EPS Surprise
Adjusted earnings per share in fiscal 2018 are expected in the range of $4.38 to $4.50 per share (excluding approximately 6 to 8 cents of Cheddar's integration related expenses).
Notably, the company plans to open new units of 35 to 40 restaurants in fiscal 2018 while comps growth is anticipated to be in the band of 1% to 2%.
Meanwhile, capital expenditures are estimated in the range of $400 to $450 million.
Zacks Rank & Other Stocks to Consider
Darden currently carries a Zacks Rank #2 (Buy). Some other favorably ranked stocks in this sector include:
Dave & Buster’s Entertainment, Inc. (PLAY - Free Report) sporting a Zacks Rank #1 (Strong Buy). It has surpassed earnings estimates in each of the trailing four quarters with an average beat of 30.50%.
Domino’s Pizza, Inc. (DPZ - Free Report) has also surpassed estimates in each of the trailing four quarters, recording an average positive surprise of 6.04%. Currently, it holds a Zacks Rank #2.
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Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500. See today's Zacks "Strong Sells" absolutely free >>
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Darden (DRI) Tops Q4 Earnings on Sales Growth, Ups Dividend
Darden Restaurants, Inc. (DRI - Free Report) reported fourth-quarter fiscal 2017 adjusted earnings of $1.18 per share, beating the Zacks Consensus Estimate of $1.15 by 2.6%. Further, earnings increased 7.3% year over year on the back of higher revenues and lower share count. Notably, this quarter marked the eleventh consecutive earnings beat for the company.
Meanwhile, total revenue of $1.93 billion surpassed the Zacks Consensus Estimate of $1.86 billion by 3.8% and increased 8.1% year over year.
Behind the Headline Numbers
Since the beginning of fourth-quarter fiscal 2015, Darden started reporting under four new segments: Olive Garden, LongHorn Steakhouse, Fine Dining that includes The Capital Grille and Eddie V's, and Other Business. The Other Business segment includes Yard House, Seasons 52, Bahama Breeze, consumer packaged goods, and franchise revenues.
The company posted comps growth of 3.3% in the quarter, on a fiscal calendar basis. Notably, it was stronger than the comps growth of 0.9% in the preceding quarter. Meanwhile, the company witnessed an increase in sales across all its brands in the fiscal fourth quarter.
Sales at Olive Garden were up 4.6% year over year to $1.03 billion. A 4.4% increase in comps at this segment was higher than prior-quarter comps growth of 1.4%. Traffic grew 2%, while there was a 1.7% improvement in pricing and 0.7% growth in menu mix.
Sales at Fine Dining increased 5.7% to $139.1 million. Comps at The Capital Grille rose 0.5%, lower than the prior-quarter comps growth of 0.9%. Meanwhile, Eddie V's posted comps growth of 3.3%, lower than the 4.7% improvement recorded in the preceding quarter.
Revenues from Other Business jumped 25.8% year over year to $331.6 million. But comps at Seasons 52 declined 1.3% for the quarter, as against the prior-quarter comps’ growth of 0.8%. Meanwhile, comps grew 1.4% at Bahama Breeze, higher than the comps growth of 0.5% in the preceding quarter. Moreover, comps at Yard House inched up 0.1% for the quarter against a 1% dip recorded in the last quarter.
At LongHorn Steakhouse, sales rose 5.7% to $436.6 million. Comps at LongHorn Steakhouse increased 3.5%, higher than the prior-quarter comps growth of 0.2%. Traffic increased 2.1%, while pricing and menu mix grew 1.3% and 0.1%, respectively.
Fiscal 2017 Results
Adjusted earnings per share in fiscal 2017 were $4.02, ahead of the Zacks Consensus Estimate of $3.99. Moreover, adjusted earnings per share surged 13.9% year over year.
Total revenue of $7.17 billion increased 3.4% year over year and topped the consensus mark of $7.09 billion.
Dividend Hike
The board of directors announced a 12.5% increase in the quarterly dividend from 56 cents to 63 cents per share, payable on Aug 1, 2017, to shareholders of record as of Jul 10, 2017. This adds up to an annual dividend of $2.24, representing a dividend yield of nearly 3%.
Darden Restaurants, Inc. Price, Consensus and EPS Surprise
Darden Restaurants, Inc. Price, Consensus and EPS Surprise | Darden Restaurants, Inc. Quote
Fiscal 2018 Outlook
Adjusted earnings per share in fiscal 2018 are expected in the range of $4.38 to $4.50 per share (excluding approximately 6 to 8 cents of Cheddar's integration related expenses).
Notably, the company plans to open new units of 35 to 40 restaurants in fiscal 2018 while comps growth is anticipated to be in the band of 1% to 2%.
Meanwhile, capital expenditures are estimated in the range of $400 to $450 million.
Zacks Rank & Other Stocks to Consider
Darden currently carries a Zacks Rank #2 (Buy). Some other favorably ranked stocks in this sector include:
Dave & Buster’s Entertainment, Inc. (PLAY - Free Report) sporting a Zacks Rank #1 (Strong Buy). It has surpassed earnings estimates in each of the trailing four quarters with an average beat of 30.50%.
Red Robin Gourmet Burgers, Inc. (RRGB - Free Report) has witnessed its full-year 2017 and 2018 earnings increase by 4.4% and 7%, respectively, over the last 60 days. It also carries a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Domino’s Pizza, Inc. (DPZ - Free Report) has also surpassed estimates in each of the trailing four quarters, recording an average positive surprise of 6.04%. Currently, it holds a Zacks Rank #2.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500. See today's Zacks "Strong Sells" absolutely free >>