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Darden (DRI) Gears Up for Q3 Earnings: What's in Store?
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Darden Restaurants, Inc. (DRI - Free Report) is scheduled to report third-quarter fiscal 2024 results on Mar 21, before the opening bell. In the last reported quarter, DRI delivered an earnings surprise of 7.6%.
Q3 Estimates
The Zacks Consensus Estimate for earnings is pegged at $2.64 per share, indicating growth of 12.8% from the prior-year levels. The consensus estimate for revenues is pegged at $3.04 billion, implying an increase of 9% from the year-ago figure.
Factors to Note
Darden is anticipated to have achieved strong performance in the third quarter of fiscal 2024, buoyed by enhancements in its menu selections, digital initiatives and impressive comparable sales. The significant rise in off-premise sales is projected to have contributed to DRI's overall revenues in the quarter under discussion.
The company has been benefiting from technological enhancements with reference to online ordering. Given the solid feedback on account of enhanced customer experience and reduced friction, management expects off-premise sales to remain elevated for some time.
DRI’s fiscal third-quarter results are likely to reflect robust performances of Olive Garden, Fine Dining and LongHorn Steakhouse. Our model predicts sales at Fine Dining and LongHorn Steakhouse, and Other revenues to increase 71.9%, 4.4% and 6.5% from the year-earlier levels to $405 million, $725.8 million and $489.7 million, respectively. We expect Olive Garden revenues to inch up 0.9% from the prior-year actuals to $1,312.7 million.
However, high costs are likely to have hurt margins in the quarter to be reported. The company remains cautious of price increases in Beef. Our model predicts total operating costs and expenses to rise 8.7% from the year-ago tally to $2,648.7 million in the fiscal third quarter.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Darden this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Darden has an Earnings ESP of -0.52% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
McDonald's Corporation (MCD - Free Report) reported mixed fourth-quarter 2023 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis.
During the quarter, MCD reported adjusted EPS of $2.95, outpacing the Zacks Consensus Estimate of $2.81. Adjusted earnings increased 11% year over year. Quarterly net revenues of $6.4 billion missed the consensus mark of $6.5 billion. However, the top line rose 8% year over year. The upside was backed by menu price increases, effective marketing campaigns, and continued digital and delivery growth.
Yum China Holdings, Inc. (YUMC - Free Report) reported impressive fourth-quarter 2023 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis.
During the quarter, YUMC reported adjusted EPS of 25 cents, beating the Zacks Consensus Estimate of 13 cents. The bottom line surged 92.3% from 13 cents reported a year ago. Quarterly revenues of $2.5 billion outpaced the consensus mark of $2.4 billion. The top line rose 19.4% on a year-over-year basis.
Brinker International, Inc. (EAT - Free Report) reported second-quarter fiscal 2024 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis. Effective marketing and pricing strategies backed the upside. Sequential improvements in guest traffic boded well.
During the quarter, EAT reported adjusted EPS of 99 cents. The Zacks Consensus Estimate was pegged at a loss of $1.47 per share. It reported adjusted EPS of 76 cents in the prior-year quarter. Quarterly revenues of $1.07 billion missed the Zacks Consensus Estimate of $1.08 billion. The top line increased 5.4% on a year-over-year basis. EAT gained from Chili's solid performance.
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Darden (DRI) Gears Up for Q3 Earnings: What's in Store?
Darden Restaurants, Inc. (DRI - Free Report) is scheduled to report third-quarter fiscal 2024 results on Mar 21, before the opening bell. In the last reported quarter, DRI delivered an earnings surprise of 7.6%.
Q3 Estimates
The Zacks Consensus Estimate for earnings is pegged at $2.64 per share, indicating growth of 12.8% from the prior-year levels. The consensus estimate for revenues is pegged at $3.04 billion, implying an increase of 9% from the year-ago figure.
Factors to Note
Darden is anticipated to have achieved strong performance in the third quarter of fiscal 2024, buoyed by enhancements in its menu selections, digital initiatives and impressive comparable sales. The significant rise in off-premise sales is projected to have contributed to DRI's overall revenues in the quarter under discussion.
The company has been benefiting from technological enhancements with reference to online ordering. Given the solid feedback on account of enhanced customer experience and reduced friction, management expects off-premise sales to remain elevated for some time.
DRI’s fiscal third-quarter results are likely to reflect robust performances of Olive Garden, Fine Dining and LongHorn Steakhouse. Our model predicts sales at Fine Dining and LongHorn Steakhouse, and Other revenues to increase 71.9%, 4.4% and 6.5% from the year-earlier levels to $405 million, $725.8 million and $489.7 million, respectively. We expect Olive Garden revenues to inch up 0.9% from the prior-year actuals to $1,312.7 million.
However, high costs are likely to have hurt margins in the quarter to be reported. The company remains cautious of price increases in Beef. Our model predicts total operating costs and expenses to rise 8.7% from the year-ago tally to $2,648.7 million in the fiscal third quarter.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Darden this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Darden has an Earnings ESP of -0.52% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Darden Restaurants, Inc. Price and EPS Surprise
Darden Restaurants, Inc. price-eps-surprise | Darden Restaurants, Inc. Quote
Recent Retail-Wholesale Releases
McDonald's Corporation (MCD - Free Report) reported mixed fourth-quarter 2023 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis.
During the quarter, MCD reported adjusted EPS of $2.95, outpacing the Zacks Consensus Estimate of $2.81. Adjusted earnings increased 11% year over year. Quarterly net revenues of $6.4 billion missed the consensus mark of $6.5 billion. However, the top line rose 8% year over year. The upside was backed by menu price increases, effective marketing campaigns, and continued digital and delivery growth.
Yum China Holdings, Inc. (YUMC - Free Report) reported impressive fourth-quarter 2023 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis.
During the quarter, YUMC reported adjusted EPS of 25 cents, beating the Zacks Consensus Estimate of 13 cents. The bottom line surged 92.3% from 13 cents reported a year ago. Quarterly revenues of $2.5 billion outpaced the consensus mark of $2.4 billion. The top line rose 19.4% on a year-over-year basis.
Brinker International, Inc. (EAT - Free Report) reported second-quarter fiscal 2024 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis. Effective marketing and pricing strategies backed the upside. Sequential improvements in guest traffic boded well.
During the quarter, EAT reported adjusted EPS of 99 cents. The Zacks Consensus Estimate was pegged at a loss of $1.47 per share. It reported adjusted EPS of 76 cents in the prior-year quarter. Quarterly revenues of $1.07 billion missed the Zacks Consensus Estimate of $1.08 billion. The top line increased 5.4% on a year-over-year basis. EAT gained from Chili's solid performance.