Darden Restaurants, Inc.
$198.27
-1.8%Darden Restaurants, Inc., through its subsidiaries, owns and operates full-service restaurants in the United States and Canada. As of May 29, 2022, it owned and operated 1,867 restaurants, which included 884 under the Olive Garden brand, 546 under the LongHorn Steakhouse brand name, 172 under the Cheddar's Scratch Kitchen brand, 85 under the Yard House brand name, 62 under The Capital Grille brand, 45 under the Seasons 52 brand name, 42 under the Bahama Breeze brand, 28 under the Eddie V's Prime Seafood brand name, and 3 under the Capital Burger brand; and franchised 60 restaurants comprising 35 under the Olive Garden brand, 18 under the LongHorn Steakhouse brand name, 4 under the Cheddar's Scratch Kitchen brand, 2 under The Capital Grille brand name, and 1 under the Bahama Breeze brand.Darden Restaurants, Inc. was founded in 1968 and is based in Orlando, Florida.
At a Glance
Live SnapshotIntrinsic Alpha Methodology
Thesis Lenses
Signal
High confidenceValuation multiple is mid-range (P/E 22.2).
Valuation inputs: P/E 22.2, earnings yield +4.5%, momentum -1.8%.
If multiples stay elevated while momentum fades, downside repricing risk rises.
Driver
High confidenceReturn profile is strong (ROE +45.4%, ROIC +11.4%).
Profitability stack: net margin +8.7%, ROE +45.4%, ROIC +11.4%.
Quality deterioration often appears in margins before it shows up in headline EPS.
Risk
High confidenceDownside profile is elevated and scenario stress-testing is essential.
Risk factors: liabilities/assets +81.6%, momentum -1.8%, net margin +8.7%.
Higher leverage with weak momentum and thin margins can amplify drawdown severity.
Darden Restaurants, Inc. Market vs Earnings Trajectory
Loading price and EPS data...
Darden Restaurants, Inc. Fair Value Envelope
Darden Restaurants, Inc. Profit Bridge
Profitability Analysis
Gross Margin
Moderate margins typical of competitive industries. Monitor for pricing pressure or rising costs.
Operating Margin
Acceptable margins but limited operational leverage. Operating expense control is important.
Net Profit Margin
Moderate profitability with room for improvement. Monitor interest expenses and tax efficiency.
Effective Tax Rate
Below-average tax rate suggests effective tax planning, favorable jurisdictions, or tax credits.
Profitability Insight
Efficient profit conversion: Minimal margin compression from gross to net indicates lean operations and favorable tax/interest environment.
Darden Restaurants, Inc. Cash Conversion Engine
Cash Flow Quality Analysis
FCF Conversion Rate
Strong cash conversion. Most reported earnings translate into actual cash flow, suggesting solid fundamentals.
CapEx Intensity
Moderate capital requirements typical of many stable businesses. Healthy balance between reinvestment and cash generation.
FCF Growth Trend
Flat FCF growth. Stable but not expanding—monitor for signs of business maturity or temporary headwinds.
Working Capital Impact
Working capital inflow boosted cash flow. Efficient management of receivables, inventory, and payables contributing positively.
Cash Flow Quality Insight
Solid cash generation: Positive free cash flow with reasonable earnings quality provides financial flexibility for growth investments, debt reduction, or shareholder returns.
Darden Restaurants, Inc. Funding & Solvency Profile
Financial Health Analysis
Current Ratio
Warning: Liquidity concerns. Current assets may not be sufficient to cover short-term obligations.
Debt-to-Equity Ratio
High financial leverage. Heavy reliance on debt may indicate increased financial risk and potential solvency concerns.
Working Capital
Negative working capital indicates short-term liabilities exceed short-term assets—potential liquidity stress.
Asset Composition
Capital-intensive business with significant long-term investments in property, equipment, or intangibles.
Financial Health Insight
Financial stress indicators: Both liquidity and leverage metrics raise concerns. The company may face challenges meeting obligations and should focus on strengthening its balance sheet.
Darden Restaurants, Inc. Street Expectations Map
Wall Street analysts project that DRI stock may rise significantly over the coming 12 months. The consensus 1-year price target stands at 225.58, with estimates ranging from a low of 200.00 to a high of 265.00.
The consensus 1-year price target stands at 225.58, with estimates ranging from a low of 200.00 to a high of 265.00.
Analyst Consensus Analysis
Upside Potential
Moderate upside. Analysts expect positive returns but with limited margin of safety. Consider entry timing.
Analyst Agreement
Good consensus alignment. Moderate target spread reflects general agreement on value drivers with some variance in assumptions.
Analyst Conviction
Positive outlook with reasonable agreement. Analysts generally optimistic about prospects with manageable uncertainty.
Market Sentiment Insight
Monitor and evaluate: Current analyst consensus suggests limited conviction or near-term catalysts. Stay informed on company developments and reassess positioning as new information emerges.
Darden Restaurants, Inc. Insider Positioning
During the last 12 months, insiders have sold $18.41M worth of DRI shares, with no buying activity reported.
3 Months
0
0.00
13.7K
2.73M
-2.7M
-$2.73M
3-6 Months
0
0.00
19.7K
4.10M
-4.1M
-$4.10M
6-9 Months
0
0.00
7.4K
1.41M
-1.4M
-$1.41M
9-12 Months
0
0.00
46.4K
10.17M
-10.2M
-$10.17M
Top Buyers
No buying activity
Top Sellers
Burrowes Todd
Officer: Group President
$4.41M
Broad Matthew R
Officer: Svp General Counsel
$2.77M
Milanes Douglas J.
Officer: Svp, Chief Supply Chain Ofcr
$2.54M
Martin Melvin John
Officer: Group President
$2.54M
Vennam Rajesh
Officer: Svp, Cfo
$1.97M
Insider Activity Analysis
Net Insider Sentiment
Strong bearish signal with $18.41M net selling. Heavy insider selling may indicate concerns about valuation or near-term prospects.
Buy/Sell Ratio
Very poor ratio. Heavy selling with minimal buying suggests insiders may be concerned about valuation or outlook.
Recent Trend (3 Months)
Heavy recent selling activity. Recent insider sales notably exceed purchases—may warrant investigation into company developments.
Insider Participation
5 insider sellers vs. 0 buyers. Widespread selling across multiple insiders may signal concerns.
Insider Activity Insight
Multiple red flags: Heavy selling, numerous sellers, and continued recent selling create a concerning pattern. Investigate fundamental drivers and consider whether company guidance or industry conditions have deteriorated.
dri Dividend History
Learning Layer
Related Guides
Build conviction on DRI by pairing this stock hub with focused valuation guides.
Research Paths
Snapshot
Start with context, operating signals, and key market metrics.
Value Model
Stress test fair value across bear, base, and bull assumptions.
Statements
Validate revenue quality, margins, and balance sheet durability.
Earnings Call
Read management commentary and compare it with reported outcomes.
Dividends
Check payout sustainability and long-term distribution behavior.
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.