Darden Restaurants (NYSE:DRI) Price Target Cut to $225.00 by Analysts at KeyCorp

Key Points

• KeyCorp has lowered its price target for Darden Restaurants from $240.00 to $225.00, while maintaining an "overweight" rating and indicating a potential upside of 16.79% from the current stock price.
• Despite KeyCorp's downgrade, multiple other firms have increased their price targets for Darden, with Citigroup setting a new target of $253.00 and Oppenheimer at $250.00.
• Darden Restaurants has authorized a $1 billion share repurchase program, reflecting management's belief that the shares are undervalued amidst recent stock performance fluctuations.

Darden Restaurants (NYSE:DRI - Get Free Report) had its target price dropped by investment analysts at KeyCorp from $240.00 to $225.00 in a note issued to investors on Friday,Benzinga reports. The brokerage presently has an "overweight" rating on the restaurant operator's stock. KeyCorp's price objective points to a potential upside of 21.84% from the stock's previous close.

Other analysts have also recently issued reports about the stock. Raymond James Financial upped their price target on shares of Darden Restaurants from $230.00 to $240.00 and gave the company an "outperform" rating in a research note on Monday, June 23rd. Stephens restated an "equal weight" rating and set a $215.00 price target on shares of Darden Restaurants in a research note on Thursday, September 18th. BTIG Research lowered their target price on shares of Darden Restaurants from $235.00 to $225.00 and set a "buy" rating on the stock in a research note on Friday. Barclays raised their price target on shares of Darden Restaurants from $235.00 to $255.00 and gave the company an "overweight" rating in a report on Monday, June 23rd. Finally, TD Securities reissued a "hold" rating and issued a $215.00 price target on shares of Darden Restaurants in a report on Friday, June 20th. Eighteen investment analysts have rated the stock with a Buy rating and ten have assigned a Hold rating to the stock. According to MarketBeat, Darden Restaurants has a consensus rating of "Moderate Buy" and an average target price of $225.96.

Darden Restaurants Stock Performance

Shares of DRI stock traded down $0.55 during trading on Friday, reaching $184.66. 469,133 shares of the company's stock traded hands, compared to its average volume of 1,325,583. The company has a market capitalization of $21.53 billion, a P/E ratio of 19.80, a PEG ratio of 1.69 and a beta of 0.71. The company has a current ratio of 0.40, a quick ratio of 0.27 and a debt-to-equity ratio of 0.96. The firm's 50-day moving average is $205.88 and its 200 day moving average is $206.17. Darden Restaurants has a 1 year low of $155.18 and a 1 year high of $228.27.

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

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

Insider Buying and Selling

In related news, insider Laura B. Williamson sold 1,157 shares of Darden Restaurants stock in a transaction on Wednesday, July 30th. The shares were sold at an average price of $204.70, for a total value of $236,837.90. Following the transaction, the insider owned 10,632 shares in the company, valued at $2,176,370.40. This trade represents a 9.81% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. Also, insider Todd Burrowes sold 13,569 shares of Darden Restaurants stock in a transaction on Monday, June 30th. The stock was sold at an average price of $216.45, for a total transaction of $2,937,010.05. Following the completion of the transaction, the insider owned 46,327 shares in the company, valued at approximately $10,027,479.15. The trade was a 22.65% decrease in their position. The disclosure for this sale can be found here. Insiders have sold a total of 23,264 shares of company stock worth $5,024,790 in the last 90 days. 0.49% of the stock is owned by company insiders.

Institutional Investors Weigh In On Darden Restaurants

A number of large investors have recently added to or reduced their stakes in DRI. GAMMA Investing LLC grew its holdings in Darden Restaurants by 46,484.5% in the 1st quarter. GAMMA Investing LLC now owns 928,895 shares of the restaurant operator's stock worth $192,987,000 after acquiring an additional 926,901 shares during the last quarter. Marshall Wace LLP grew its holdings in Darden Restaurants by 820.4% in the 2nd quarter. Marshall Wace LLP now owns 706,416 shares of the restaurant operator's stock worth $153,977,000 after acquiring an additional 629,669 shares during the last quarter. Invesco Ltd. grew its holdings in Darden Restaurants by 45.2% in the 2nd quarter. Invesco Ltd. now owns 1,917,398 shares of the restaurant operator's stock worth $417,935,000 after acquiring an additional 596,863 shares during the last quarter. Arrowstreet Capital Limited Partnership grew its holdings in Darden Restaurants by 192.6% in the 2nd quarter. Arrowstreet Capital Limited Partnership now owns 880,765 shares of the restaurant operator's stock worth $191,980,000 after acquiring an additional 579,759 shares during the last quarter. Finally, Norges Bank bought a new stake in Darden Restaurants in the 2nd quarter worth $125,521,000. 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.