Analysts Adjust Predictions for Darden Restaurants After Q1

Author: Riley Hayes Updated: 09-20-2024 08:42 AM

Analyzing Darden Restaurants’ Recent Earnings Performance

Darden Restaurants, Inc. (NYSE: DRI) recently disclosed that their first-quarter financial outcomes were below expectations. The adjusted earnings per share reported were $1.75, which fell short of the forecasted $1.83. Their quarterly sales came in at $2.76 billion, also under the expected $2.80 billion, signaling some challenges for the company.

Leadership’s Take on Company Performance

Despite the results not aligning with projections, Darden's President and CEO, Rick Cardenas, expressed confidence in the business’s resilience and long-term potential. His remarks suggest a positive outlook regarding the company's ability to navigate through this financial hiccup.

Dividend Announcement

In a move to reward shareholders, Darden's board of directors approved a quarterly cash dividend of $1.40 per share on the company’s outstanding common stock. This dividend is scheduled to be distributed to shareholders on November 1, based on records dated as of the business day’s close on October 10.

Stock Market Response

Following the earnings announcement, Darden shares experienced a significant uptick, increasing by 8.3% to conclude the trading day at $172.27. This reaction may indicate investor confidence despite the revealed setbacks.

Analyst Predictions and Price Target Adjustments

In light of the recent earnings disclosure, various analysts have adjusted their price targets for Darden Restaurants:

Changes from Different Analysts

TD Cowen's Andrew Charles retained a Hold rating while increasing the price target from $150 to $165.
Bernstein's Danilo Gargiulo downgraded the stock from Outperform to Market Perform, which involved a significant reduction in the price target from $190 to $180.
Stephens & Co.'s analyst Jim Salera maintained an Equal-Weight rating and lifted the price target marginally from $159 to $164.
Wedbush's Nick Setyan held the Outperform rating steady but raised the price target from $170 to $200.
Evercore ISI's David Palmer upgraded Darden from In-Line to Outperform and increased the price target significantly from $165 to $205.

Considerations for Investors in DRI Stock

Given the varied perspectives from analysts, both potential and current investors may want to weigh these insights carefully when considering Darden Restaurants as part of their investment portfolio. The adjustments in price targets reflect a mix of caution and optimism, which is essential to navigate in the current market landscape.

Frequently Asked Questions

What were Darden Restaurants' earnings per share in Q1?

Darden reported adjusted earnings per share of $1.75 in the first quarter, which was below the analyst consensus estimate of $1.83.

How has the stock price of Darden changed after the earnings announcement?

Darden shares increased by 8.3%, closing at $172.27 following the earnings report.

What dividend amount has Darden announced for its shareholders?

Darden announced a quarterly cash dividend of $1.40 per share, payable to shareholders on November 1.

Which analysts adjusted their price targets for Darden?

Analysts from organizations such as TD Cowen, Bernstein, Stephens & Co., Wedbush, and Evercore ISI all made revisions to their price targets after the earnings report.

What is the significance of the analysts' revisions on Darden's stock?

The revisions in price targets reflect the analysts' reassessment of Darden's performance and future potential, offering insights to investors about market sentiment.

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