Back to top

Image: Bigstock

Darden Restaurants (DRI) Dips More Than Broader Markets: What You Should Know

Read MoreHide Full Article

Darden Restaurants (DRI - Free Report) closed the most recent trading day at $140.43, moving -0.66% from the previous trading session. This change lagged the S&P 500's 0.21% loss on the day.

Coming into today, shares of the owner of Olive Garden and other chain restaurants had lost 0.55% in the past month. In that same time, the Retail-Wholesale sector lost 2.93%, while the S&P 500 gained 0.59%.

DRI will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.70, up 237.1% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.12 billion, up 67.25% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.97 per share and revenue of $7.04 billion. These totals would mark changes of +26.84% and -9.82%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for DRI. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.06% higher. DRI is currently a Zacks Rank #3 (Hold).

Looking at its valuation, DRI is holding a Forward P/E ratio of 35.63. This valuation marks a premium compared to its industry's average Forward P/E of 32.88.

Investors should also note that DRI has a PEG ratio of 3.56 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. DRI's industry had an average PEG ratio of 3.05 as of yesterday's close.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 96, putting it in the top 38% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Darden Restaurants, Inc. (DRI) - free report >>

Published in