NYSE:DRI

Stock Analysis Report

Executive Summary

Darden Restaurants, Inc., through its subsidiaries, owns and operates full-service restaurants in the United States and Canada.

Snowflake

Fundamentals

Solid track record established dividend payer.


Similar Companies

Share Price & News

How has Darden Restaurants's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: DRI has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.9%

DRI

1.3%

US Hospitality

0.9%

US Market


1 Year Return

1.9%

DRI

11.2%

US Hospitality

16.8%

US Market

Return vs Industry: DRI underperformed the US Hospitality industry which returned 11.2% over the past year.

Return vs Market: DRI underperformed the US Market which returned 16.8% over the past year.


Shareholder returns

DRIIndustryMarket
7 Day0.9%1.3%0.9%
30 Day2.8%3.9%4.5%
90 Day-5.1%4.3%6.2%
1 Year4.9%1.9%14.0%11.2%19.4%16.8%
3 Year67.0%53.4%32.2%22.9%47.5%38.0%
5 Year168.5%106.4%35.4%20.9%62.0%44.1%

Price Volatility Vs. Market

How volatile is Darden Restaurants's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Darden Restaurants undervalued compared to its fair value and its price relative to the market?

19.39x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: DRI ($113.49) is trading above our estimate of fair value ($101.27)

Significantly Below Fair Value: DRI is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: DRI is good value based on its PE Ratio (19.4x) compared to the Hospitality industry average (22.1x).

PE vs Market: DRI is poor value based on its PE Ratio (19.4x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: DRI is poor value based on its PEG Ratio (3.5x)


Price to Book Ratio

PB vs Industry: DRI is overvalued based on its PB Ratio (5.8x) compared to the US Hospitality industry average (2.2x).


Next Steps

Future Growth

How is Darden Restaurants forecast to perform in the next 1 to 3 years based on estimates from 26 analysts?

5.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DRI's forecast earnings growth (5.5% per year) is above the savings rate (2.7%).

Earnings vs Market: DRI's earnings (5.5% per year) are forecast to grow slower than the US market (14.4% per year).

High Growth Earnings: DRI's earnings are forecast to grow, but not significantly.

Revenue vs Market: DRI's revenue (3.6% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: DRI's revenue (3.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: DRI's Return on Equity is forecast to be high in 3 years time (27.2%)


Next Steps

Past Performance

How has Darden Restaurants performed over the past 5 years?

28.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: DRI has high quality earnings.

Growing Profit Margin: DRI's current net profit margins (8.4%) are higher than last year (7.9%).


Past Earnings Growth Analysis

Earnings Trend: DRI's earnings have grown significantly by 28.7% per year over the past 5 years.

Accelerating Growth: DRI's earnings growth over the past year (10.9%) is below its 5-year average (28.7% per year).

Earnings vs Industry: DRI earnings growth over the past year (10.9%) exceeded the Hospitality industry -15.7%.


Return on Equity

High ROE: DRI's Return on Equity (30.3%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Darden Restaurants's financial position?


Financial Position Analysis

Short Term Liabilities: DRI's short term assets ($670.3M) do not cover its short term liabilities ($1.5B)

Long Term Liabilities: DRI's short term assets ($670.3M) do not cover its long term liabilities (5.8B)


Debt to Equity History and Analysis

Debt Level: DRI's debt to equity ratio (39%) is considered satisfactory.

Reducing Debt: DRI's debt to equity ratio has reduced from 74.4% to 39% over the past 5 years.

Debt Coverage: DRI's debt is well covered by operating cash flow (140.5%).

Interest Coverage: DRI's interest payments on its debt are well covered by EBIT (17.9x coverage).


Balance Sheet

Inventory Level: DRI has a high level of physical assets or inventory.

Debt Coverage by Assets: DRI's debt is not covered by short term assets (assets are 0.7x debt).


Next Steps

Dividend

What is Darden Restaurants's current dividend yield, its reliability and sustainability?

3.10%

Current Dividend Yield


Dividend Yield vs Market

company3.1%marketbottom25%1.4%markettop25%3.7%industryaverage3.1%forecastin3Years3.4%

Current dividend yield vs market & industry

Notable Dividend: DRI's dividend (3.1%) is higher than the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: DRI's dividend (3.1%) is low compared to the top 25% of dividend payers in the US market (3.68%).


Stability and Growth of Payments

Stable Dividend: DRI's dividends per share have been stable in the past 10 years.

Growing Dividend: DRI's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (53.5%), DRI's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: DRI's dividends in 3 years are forecast to be covered by earnings (54.2% payout ratio).


Next Steps

Management

What is the CEO of Darden Restaurants's salary, the management and board of directors tenure and is there insider trading?

3.7yrs

Average management tenure


CEO

Gene Lee (57yo)

4.8yrs

Tenure

US$10,710,578

Compensation

Mr. Eugene I. Lee, Jr., also known as Gene, has been the Chief Executive Officer and President of Darden Restaurants, Inc. since February 23, 2015 and September 2013 respectively. Mr. Lee served as an Inte ...


CEO Compensation Analysis

Compensation vs Market: Gene's total compensation ($USD10.71M) is about average for companies of similar size in the US market ($USD11.07M).

Compensation vs Earnings: Gene's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.7yrs

Average Tenure

57yo

Average Age

Experienced Management: DRI's management team is considered experienced (3.7 years average tenure).


Board Age and Tenure

4.9yrs

Average Tenure

60yo

Average Age

Experienced Board: DRI's board of directors are considered experienced (4.9 years average tenure).


Insider Trading

Insider Buying: DRI insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$124,22328 Oct 19
Nana Mensah
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,103
Max PriceUS$112.62
SellUS$190,48026 Sep 19
Douglas Milanes
EntityIndividual
Shares1,600
Max PriceUS$119.05
SellUS$43,06831 Jul 19
John Madonna
EntityIndividual
Shares347
Max PriceUS$124.12
SellUS$150,28831 Jul 19
Matthew Broad
EntityIndividual
Shares1,200
Max PriceUS$125.24
SellUS$39,19127 Mar 19
John Madonna
EntityIndividual
Shares330
Max PriceUS$118.76
SellUS$164,16901 Feb 19
William Simon
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,565
Max PriceUS$104.90

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Gene Lee (57yo)

    President

    • Tenure: 4.8yrs
    • Compensation: US$10.71m
  • Chris Chang

    Senior VP & Chief Information Officer

    • Tenure: 3.6yrs
  • Dave George (63yo)

    Executive VP & COO

    • Tenure: 1.8yrs
    • Compensation: US$3.99m
  • Jon Norem

    Managing Partner

    • Tenure: 0yrs
  • John Rucker

    Managing Partner

    • Tenure: 0yrs
  • Kyle Holmes

    Managing Partner

    • Tenure: 0yrs
  • Todd Burrowes (56yo)

    President of Longhorn Steakhouse

    • Tenure: 4.3yrs
    • Compensation: US$2.80m
  • Rick Cardenas (51yo)

    Senior VP & CFO

    • Tenure: 3.7yrs
    • Compensation: US$3.43m
  • Dan Kiernan (58yo)

    President of Olive Garden

    • Tenure: 1.8yrs
    • Compensation: US$2.28m
  • Kevin Kalicak

    Vice President of Investor Relations & Corporate Analysis

    • Tenure: 4.9yrs

Board Members

  • Margaret Atkins (62yo)

    Independent Director

    • Tenure: 5.1yrs
    • Compensation: US$234.33k
  • Gene Lee (57yo)

    President

    • Tenure: 4.8yrs
    • Compensation: US$10.71m
  • Jim Fogarty (51yo)

    Independent Director

    • Tenure: 5.8yrs
    • Compensation: US$239.33k
  • Nana Mensah (66yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$229.33k
  • Chuck Sonsteby (65yo)

    Chairman of the Board

    • Tenure: 3.6yrs
    • Compensation: US$256.83k
  • Cindie Jamison (59yo)

    Independent Director

    • Tenure: 5.8yrs
    • Compensation: US$253.23k
  • Tim Wilmott (60yo)

    Independent Director

    • Tenure: 1.2yrs
    • Compensation: US$200.43k
  • Bill Simon (60yo)

    Independent Director

    • Tenure: 5.1yrs
    • Compensation: US$229.96k

Company Information

Darden Restaurants, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Darden Restaurants, Inc.
  • Ticker: DRI
  • Exchange: NYSE
  • Founded: 1968
  • Industry: Restaurants
  • Sector: Consumer Services
  • Market Cap: US$13.888b
  • Shares outstanding: 122.60m
  • Website: https://www.darden.com

Number of Employees


Location

  • Darden Restaurants, Inc.
  • 1000 Darden Center Drive
  • Orlando
  • Florida
  • 32837
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
DRINYSE (New York Stock Exchange)YesCommon StockUSUSDMay 1995
DDNDB (Deutsche Boerse AG)YesCommon StockDEEURMay 1995
0I77LSE (London Stock Exchange)YesCommon StockGBUSDMay 1995

Biography

Darden Restaurants, Inc., through its subsidiaries, owns and operates full-service restaurants in the United States and Canada. As of May 26, 2019, it owned and operated approximately 1,785 restaurants und ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/11/19 23:34
End of Day Share Price2019/11/19 00:00
Earnings2019/08/25
Annual Earnings2019/05/26


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.