Per market reports, Darden Restaurants’ (DRI - Free Report) Olive Garden Italian Kitchen recently announced plan to launch its first restaurant in Honolulu, HI. Notably, the new restaurant will open at Ala Moana Center.
Meanwhile, Olive Garden filed an application for a $50,000 building permit for suite 3247, which is currently occupied by Mai Tai Bar.
Expansion Plans to Drive Sales
We believe the company’s effort to expand its footprint, and refine and streamline menu will help drive sales and traffic. It has operations in the United States and Canada with more than 1,700 restaurants. Darden plans to open 50 gross and 44 net new restaurants in 2020.
In order to boost performance of the Olive Garden brand, the company had earlier implemented a set of initiatives under its Brand Renaissance Plan.
These included simplifying kitchen systems, improving sales planning and scheduling, operational excellence to improve guest experience, developing new core menu items, allowing customization and making smarter promotional investments.
Moreover, Olive Garden’s second-quarter 2020 revenues reflect positive comparable restaurant sales and off-premise sales. Sales at Olive Garden increased 2.6% year over year to $1,023.6 million. Comps grew 1.5% at the segment, lower than the prior-quarter’s comps growth of 2.2%. Further, the company expects comps to increase 1-2% in fiscal 2020.
Also, in second-quarter fiscal 2020, Olive Garden's off-premise business improved 17% and accounted for 17% of total sales. It also marked the brand’s 21st consecutive quarter of positive comps.
In the past three months, shares of this Zacks Rank #3 (Hold) company have gained 3.7% compared with its industry’s 1% growth.
Some better-ranked stocks that belong to the same space are Chuy's Holdings, Inc. (CHUY - Free Report) , Denny's Corporation (DENN - Free Report) and Noodles & Company (NDLS - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can the complete list of today’s Zacks #1 Rank stocks here.
Chuy’s, Denny’s and Noodles have impressive long-term earnings growth rate of 17.5%, 9% and 10%, respectively.
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