Valued at a market cap of $22.4 billion, Darden Restaurants, Inc. (DRI) owns and operates full-service restaurants. The Orlando, Florida-based company operates under various well-known brands, including Olive Garden, LongHorn Steakhouse, and Cheddar's Scratch Kitchen, to name a few.
This restaurant has considerably underperformed the broader market over the past 52 weeks. Shares of DRI have declined 6.3% over this time frame, while the broader S&P 500 Index ($SPX) has soared 25.2%. Moreover, on a YTD basis, the stock is up 6.5%, compared to SPX’s 8.1% rise.
Narrowing the focus, the company has lagged the State Street Consumer Discretionary Select Sector SPDR Fund’s (XLY) 8.1% return over the past 52 weeks. However, it has outpaced XLY’s 2.4% drop on a YTD basis.
Shares of DRI gained 1.9% on Mar. 19 after the company reported strong Q3 2026 results. Its total sales increased 5.9% year-over-year to $3.3 billion, while same-restaurant sales rose 4.2%. Investor sentiment was further lifted by adjusted EPS growth of 5.4% to $2.95 and solid performance across key brands, including Olive Garden and LongHorn Steakhouse.
For the current fiscal year, ending in May, analysts expect DRI’s EPS to grow 11.1% year over year to $10.61. The company’s earnings surprise history is mixed. It met or topped the consensus estimates in two of the last four quarters, while missing on two other occasions.
Among the 31 analysts covering the stock, the consensus rating is a "Moderate Buy,” which is based on 19 “Strong Buy,” one "Moderate Buy," and 11 "Hold” ratings.
The configuration is more bullish than two months ago, with 18 analysts suggesting a “Strong Buy” rating.
On Apr. 9, Oppenheimer analyst Brian Bittner reiterated a “Buy” rating on DRI and set a price target of $235, indicating a 20% potential upside from the current levels.
The mean price target of $226.66 suggests a 15.7% premium to its current price levels, while its Street-high price target of $272 implies a 38.9% potential upside.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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