Darden Restaurants, Inc. (NYSE:DRI) Stake Lifted by Hamlin Capital Management LLC

Key Points

• Hamlin Capital Management LLC increased its stake in Darden Restaurants by 17.6% during the first quarter, bringing its total holdings to 913,398 shares, making it the 6th largest position in its portfolio.
• Darden Restaurants recently reported $2.98 earnings per share for the quarter, surpassing the consensus estimate, and announced a quarterly dividend increase to $1.50 per share, reflecting a yield of 2.9%.
• Research analysts have varied opinions on DRI, with several cutting their ratings while others raised price targets, leading to a consensus rating of "Moderate Buy" and an average target price of $225.19.

Hamlin Capital Management LLC raised its holdings in Darden Restaurants, Inc. (NYSE:DRI - Free Report) by 17.6% in the first quarter, according to the company in its most recent filing with the Securities and Exchange Commission. The fund owned 913,398 shares of the restaurant operator's stock after acquiring an additional 136,382 shares during the period. Darden Restaurants makes up approximately 4.5% of Hamlin Capital Management LLC's investment portfolio, making the stock its 6th largest position. Hamlin Capital Management LLC owned about 0.78% of Darden Restaurants worth $189,768,000 as of its most recent SEC filing.

A number of other institutional investors have also bought and sold shares of DRI. Kovitz Investment Group Partners LLC increased its holdings in shares of Darden Restaurants by 2.7% during the 1st quarter. Kovitz Investment Group Partners LLC now owns 2,970 shares of the restaurant operator's stock worth $617,000 after buying an additional 79 shares during the last quarter. Tokio Marine Asset Management Co. Ltd. raised its position in Darden Restaurants by 2.7% in the first quarter. Tokio Marine Asset Management Co. Ltd. now owns 4,612 shares of the restaurant operator's stock valued at $958,000 after purchasing an additional 120 shares during the period. Caitong International Asset Management Co. Ltd purchased a new stake in Darden Restaurants in the first quarter valued at $85,000. National Pension Service lifted its stake in shares of Darden Restaurants by 0.3% in the 1st quarter. National Pension Service now owns 191,988 shares of the restaurant operator's stock valued at $39,887,000 after purchasing an additional 556 shares during the last quarter. Finally, Resona Asset Management Co. Ltd. grew its holdings in shares of Darden Restaurants by 4.2% during the 1st quarter. Resona Asset Management Co. Ltd. now owns 37,994 shares of the restaurant operator's stock worth $7,878,000 after purchasing an additional 1,541 shares during the period. 93.64% of the stock is owned by hedge funds and other institutional investors.

Analyst Ratings Changes

A number of research analysts have commented on DRI shares. Wall Street Zen cut shares of Darden Restaurants from a "buy" rating to a "hold" rating in a research report on Friday, June 27th. Stephens upped their price objective on shares of Darden Restaurants from $200.00 to $212.00 and gave the stock an "equal weight" rating in a report on Monday, June 23rd. BMO Capital Markets lifted their target price on shares of Darden Restaurants from $190.00 to $215.00 and gave the company a "market perform" rating in a report on Wednesday, June 25th. JPMorgan Chase & Co. raised their price target on Darden Restaurants from $218.00 to $240.00 and gave the stock an "overweight" rating in a research report on Wednesday, June 25th. Finally, Morgan Stanley boosted their price objective on Darden Restaurants from $215.00 to $235.00 and gave the company an "overweight" rating in a report on Wednesday, June 18th. Twelve equities research analysts have rated the stock with a hold rating and sixteen have assigned a buy rating to the company. According to data from MarketBeat, the company has a consensus rating of "Moderate Buy" and an average target price of $225.19.

Darden Restaurants Price Performance

Darden Restaurants stock opened at $207.12 on Thursday. The business has a 50 day simple moving average of $212.54 and a 200-day simple moving average of $203.90. Darden Restaurants, Inc. has a 12 month low of $140.50 and a 12 month high of $228.27. The company has a debt-to-equity ratio of 0.92, a current ratio of 0.42 and a quick ratio of 0.28. The stock has a market capitalization of $24.15 billion, a PE ratio of 23.32, a price-to-earnings-growth ratio of 1.89 and a beta of 0.75.

Darden Restaurants (NYSE:DRI - Get Free Report) last posted its earnings results on Friday, June 20th. The restaurant operator reported $2.98 earnings per share for the quarter, beating the consensus estimate of $2.97 by $0.01. The firm had revenue of $3.27 billion during the quarter, compared to the consensus estimate of $3.25 billion. Darden Restaurants had a net margin of 8.69% and a return on equity of 51.81%. The firm's revenue for the quarter was up 10.6% on a year-over-year basis. During the same period last year, the firm posted $2.65 EPS. Equities analysts predict that Darden Restaurants, Inc. will post 9.52 earnings per share for the current year.

Darden Restaurants Increases Dividend

The business also recently announced a quarterly dividend, which was paid on Friday, August 1st. Shareholders of record on Thursday, July 10th were issued a dividend of $1.50 per share. This is a boost from Darden Restaurants's previous quarterly dividend of $1.40. The ex-dividend date was Thursday, July 10th. This represents a $6.00 dividend on an annualized basis and a yield of 2.9%. Darden Restaurants's payout ratio is currently 67.57%.

Darden Restaurants announced that its Board of Directors has initiated a share buyback program on Friday, June 20th that permits the company to buyback $1.00 billion in outstanding shares. This buyback authorization permits the restaurant operator to reacquire up to 3.8% of its stock through open market purchases. Stock buyback programs are usually an indication that the company's board believes its shares are undervalued.

Insider Activity

In other news, insider Todd Burrowes sold 13,569 shares of the company's stock in a transaction on Monday, June 30th. The stock was sold at an average price of $216.45, for a total value of $2,937,010.05. Following the sale, the insider directly owned 46,327 shares in the company, valued at $10,027,479.15. This represents a 22.65% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, SVP Susan M. Connelly sold 4,735 shares of the stock in a transaction on Tuesday, June 24th. The shares were sold at an average price of $223.78, for a total value of $1,059,598.30. Following the sale, the senior vice president directly owned 4,602 shares in the company, valued at approximately $1,029,835.56. The trade was a 50.71% decrease in their position. The disclosure for this sale can be found here. Insiders have sold 45,727 shares of company stock worth $10,022,232 in the last quarter. 0.49% of the stock is currently owned by corporate insiders.

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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