Darden Restaurants (NYSE:DRI) Price Target Raised to $238.00

Key Points

• Morgan Stanley has raised its price target for Darden Restaurants from $235.00 to $238.00, reflecting a potential upside of 27.15% based on the stock's current price.
• Despite the positive outlook from some analysts, other brokerages like Barclays and KeyCorp have lowered their price targets, indicating a mixed sentiment among investors.
• Darden's recent quarterly earnings reported a net margin of 8.69%, with revenues of $3.04 billion, showing a year-over-year increase of 10.4% despite missing EPS estimates.

Darden Restaurants (NYSE:DRI - Get Free Report) had its price target boosted by stock analysts at Morgan Stanley from $235.00 to $238.00 in a report released on Friday,Benzinga reports. The firm currently has an "overweight" rating on the restaurant operator's stock. Morgan Stanley's target price suggests a potential upside of 28.60% from the company's current price.

Other equities analysts also recently issued research reports about the stock. Jefferies Financial Group upgraded shares of Darden Restaurants from an "underperform" rating to a "hold" rating and boosted their price target for the stock from $165.00 to $210.00 in a research note on Friday, June 13th. Barclays cut their price target on Darden Restaurants from $255.00 to $230.00 and set an "overweight" rating on the stock in a report on Friday. KeyCorp lowered their price objective on Darden Restaurants from $240.00 to $225.00 and set an "overweight" rating for the company in a research report on Friday. Truist Financial cut their target price on shares of Darden Restaurants from $252.00 to $240.00 and set a "buy" rating on the stock in a research note on Friday. Finally, Stephens reiterated an "equal weight" rating and issued a $215.00 price target on shares of Darden Restaurants in a research note on Thursday. Eighteen research analysts have rated the stock with a Buy rating and ten have issued a Hold rating to the company's stock. According to MarketBeat.com, Darden Restaurants has an average rating of "Moderate Buy" and a consensus target price of $225.96.

Darden Restaurants Trading Up 0.2%

Shares of NYSE DRI traded up $0.34 during midday trading on Friday, reaching $185.07. 2,103,148 shares of the stock were exchanged, compared to its average volume of 1,313,586. The stock has a market capitalization of $21.58 billion, a P/E ratio of 18.89, a PEG ratio of 1.69 and a beta of 0.71. The company has a debt-to-equity ratio of 0.96, a quick ratio of 0.27 and a current ratio of 0.40. The company has a 50 day simple moving average of $206.37 and a 200 day simple moving average of $206.24. Darden Restaurants has a twelve month low of $155.18 and a twelve month high of $228.27.

Darden Restaurants (NYSE:DRI - Get Free Report) last released its quarterly earnings data on Thursday, September 18th. The restaurant operator reported $1.97 EPS for the quarter, missing analysts' consensus estimates of $2.01 by ($0.04). Darden Restaurants had a net margin of 8.90% and a return on equity of 52.35%. The business had revenue of $3.04 billion during the quarter, compared to analyst estimates of $3.03 billion. During the same quarter in the prior year, the company posted $1.75 earnings per share. The company's revenue was up 10.4% on a year-over-year basis. Darden Restaurants has set its FY 2026 guidance at 10.500-10.700 EPS. As a group, equities analysts expect that Darden Restaurants will post 9.52 earnings per share for the current year.

Darden Restaurants announced that its Board of Directors has authorized a stock repurchase program on Friday, June 20th that authorizes the company to buyback $1.00 billion in shares. This buyback authorization authorizes the restaurant operator to buy up to 3.8% of its stock through open market purchases. Stock buyback programs are generally a sign that the company's management believes its shares are undervalued.

Insider Transactions at Darden Restaurants

In other Darden Restaurants news, SVP Douglas J. Milanes sold 11,948 shares of the firm's stock in a transaction dated Tuesday, June 24th. The stock was sold at an average price of $222.08, for a total transaction of $2,653,411.84. Following the transaction, the senior vice president owned 147 shares of the company's stock, valued at approximately $32,645.76. This trade represents a 98.78% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CFO Rajesh Vennam sold 5,780 shares of the business's stock in a transaction dated Tuesday, June 24th. The shares were sold at an average price of $222.22, for a total value of $1,284,431.60. Following the completion of the sale, the chief financial officer directly owned 4,555 shares of the company's stock, valued at $1,012,212.10. The trade was a 55.93% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last three months, insiders sold 45,727 shares of company stock worth $10,022,232. Insiders own 0.49% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds have recently added to or reduced their stakes in the company. Twin Peaks Wealth Advisors LLC purchased a new stake in Darden Restaurants in the second quarter valued at approximately $26,000. Grove Bank & Trust raised its position in Darden Restaurants by 171.4% in the 1st quarter. Grove Bank & Trust now owns 133 shares of the restaurant operator's stock valued at $28,000 after purchasing an additional 84 shares during the last quarter. Elevation Point Wealth Partners LLC acquired a new stake in Darden Restaurants during the 2nd quarter worth $29,000. True Wealth Design LLC boosted its stake in Darden Restaurants by 419.2% during the 2nd quarter. True Wealth Design LLC now owns 135 shares of the restaurant operator's stock worth $29,000 after purchasing an additional 109 shares during the period. Finally, ORG Partners LLC grew its position in Darden Restaurants by 108.8% during the 1st quarter. ORG Partners LLC now owns 142 shares of the restaurant operator's stock worth $30,000 after purchasing an additional 74 shares during the last quarter. Hedge funds and other institutional investors own 93.64% of the company's stock.

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.