Darden Restaurants (DRI - Free Report) closed at $118.85 in the latest trading session, marking a -0.6% move from the prior day. This change was narrower than the S&P 500's 0.79% loss on the day. At the same time, the Dow lost 0.66%, and the tech-heavy Nasdaq lost 0.68%.
Prior to today's trading, shares of the owner of Olive Garden and other chain restaurants had lost 4.69% over the past month. This has lagged the Retail-Wholesale sector's loss of 2.45% and the S&P 500's loss of 1.62% in that time.
DRI will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.36, up 1.49% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.14 billion, up 3.66% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.39 per share and revenue of $9.04 billion. These totals would mark changes of +9.79% and +6.23%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for DRI. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.01% lower. DRI is holding a Zacks Rank of #3 (Hold) right now.
Looking at its valuation, DRI is holding a Forward P/E ratio of 18.72. This represents a discount compared to its industry's average Forward P/E of 22.98.
Also, we should mention that DRI has a PEG ratio of 1.85. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Restaurants industry currently had an average PEG ratio of 2.26 as of yesterday's close.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 87, putting it in the top 34% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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 Zacks.com.