Darden Restaurants' (DRI) Buy Rating Reaffirmed at Truist Financial

Key Points

• Darden Restaurants received a "buy" rating reaffirmed by Truist Financial, with a target price of $252.00, indicating a potential upside of 21.28% from its current stock price.
• The company reported $2.98 earnings per share for the quarter, beating expectations and showing a 10.6% year-over-year revenue growth of $3.27 billion.
• Darden has initiated a $1 billion share buyback plan, which typically signals that the company's leadership believes its shares are undervalued.

Darden Restaurants (NYSE:DRI - Get Free Report)'s stock had its "buy" rating reiterated by equities researchers at Truist Financial in a research report issued to clients and investors on Tuesday,Benzinga reports. They presently have a $252.00 target price on the restaurant operator's stock. Truist Financial's price target points to a potential upside of 21.28% from the company's current price.

Several other research analysts have also issued reports on DRI. Morgan Stanley raised their target price on shares of Darden Restaurants from $215.00 to $235.00 and gave the company an "overweight" rating in a research note on Wednesday, June 18th. Wells Fargo & Company lifted their price objective on shares of Darden Restaurants from $200.00 to $225.00 and gave the stock an "equal weight" rating in a research note on Tuesday, June 17th. Stephens lifted their price objective on shares of Darden Restaurants from $200.00 to $212.00 and gave the stock an "equal weight" rating in a research note on Monday, June 23rd. Evercore ISI lifted their price objective on shares of Darden Restaurants from $230.00 to $250.00 and gave the stock an "outperform" rating in a research note on Monday, June 16th. Finally, Wall Street Zen lowered shares of Darden Restaurants from a "buy" rating to a "hold" rating in a research note on Friday, June 27th. Sixteen equities research analysts have rated the stock with a Buy rating and eleven have given a Hold rating to the stock. According to data from MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and an average price target of $225.19.

Darden Restaurants Trading Up 0.4%

Shares of NYSE DRI traded up $0.84 during mid-day trading on Tuesday, hitting $207.78. The company's stock had a trading volume of 110,152 shares, compared to its average volume of 1,295,848. The stock has a market cap of $24.23 billion, a price-to-earnings ratio of 23.39, a price-to-earnings-growth ratio of 1.90 and a beta of 0.71. The company has a debt-to-equity ratio of 0.92, a current ratio of 0.42 and a quick ratio of 0.28. Darden Restaurants has a one year low of $153.98 and a one year high of $228.27. The company's fifty day simple moving average is $209.05 and its 200-day simple moving average is $205.02.

Darden Restaurants (NYSE:DRI - Get Free Report) last issued its earnings results on Friday, June 20th. The restaurant operator reported $2.98 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.97 by $0.01. The company had revenue of $3.27 billion for the quarter, compared to analyst estimates of $3.25 billion. Darden Restaurants had a net margin of 8.69% and a return on equity of 51.81%. The company's revenue for the quarter was up 10.6% on a year-over-year basis. During the same quarter last year, the firm earned $2.65 EPS. Darden Restaurants has set its FY 2026 guidance at 10.500-10.700 EPS. On average, sell-side analysts anticipate that Darden Restaurants will post 9.52 earnings per share for the current fiscal year.

Darden Restaurants announced that its board has initiated a share buyback plan on Friday, June 20th that allows the company to repurchase $1.00 billion in outstanding shares. This repurchase authorization allows the restaurant operator to purchase up to 3.8% of its stock through open market purchases. Stock repurchase plans are typically a sign that the company's leadership believes its shares are undervalued.

Insider Buying and Selling

In other news, SVP Matthew R. Broad sold 733 shares of Darden Restaurants stock in a transaction that occurred on Tuesday, July 1st. The shares were sold at an average price of $218.50, for a total value of $160,160.50. Following the sale, the senior vice president directly owned 14,367 shares in the company, valued at $3,139,189.50. This trade represents a 4.85% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. Also, SVP Susan M. Connelly sold 4,735 shares of Darden Restaurants stock in a transaction that occurred on Tuesday, June 24th. The shares were sold at an average price of $223.78, for a total transaction of $1,059,598.30. Following the completion of the sale, the senior vice president owned 4,602 shares in the company, valued at $1,029,835.56. This trade represents a 50.71% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 45,727 shares of company stock valued at $10,022,232 over the last ninety days. Insiders own 0.49% of the company's stock.

Institutional Trading of Darden Restaurants

Hedge funds and other institutional investors have recently made changes to their positions in the business. Twin Peaks Wealth Advisors LLC acquired a new stake in shares of Darden Restaurants in the second quarter valued at approximately $26,000. Grove Bank & Trust grew its stake in shares of Darden Restaurants by 171.4% in the first quarter. Grove Bank & Trust now owns 133 shares of the restaurant operator's stock valued at $28,000 after buying an additional 84 shares in the last quarter. Elevation Point Wealth Partners LLC bought a new position in shares of Darden Restaurants in the second quarter valued at $29,000. True Wealth Design LLC grew its stake in shares of Darden Restaurants by 419.2% in the second quarter. True Wealth Design LLC now owns 135 shares of the restaurant operator's stock valued at $29,000 after buying an additional 109 shares in the last quarter. Finally, ORG Partners LLC grew its stake in shares of Darden Restaurants by 108.8% in the first quarter. ORG Partners LLC now owns 142 shares of the restaurant operator's stock valued at $30,000 after buying an additional 74 shares in the last quarter. 93.64% of the stock is currently owned by institutional investors and hedge funds.

About Darden Restaurants

Darden Restaurants, Inc, together with its subsidiaries, owns and operates full-service restaurants in the United States and Canada. It operates under Olive Garden, LongHorn Steakhouse, Cheddar's Scratch Kitchen, Yard House, The Capital Grille, Seasons 52, Bahama Breeze, Eddie V's Prime Seafood, and Capital Burger brand names.

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