Darden Restaurants Shows Strong Market Performance Amid Challenges

With a market cap of $24.3 billion, Darden Restaurants, Inc. (DRI) stands as one of the largest full-service dining restaurant operators in the U.S. and Canada, boasting over 1,700 locations. Headquartered in Orlando, Florida, the company manages renowned brands such as Olive Garden, LongHorn Steakhouse, The Capital Grille, and Cheddar’s Scratch Kitchen.

Classified as a “large-cap” stock, Darden fits the profile with a valuation exceeding $10 billion. The company offers a diverse portfolio, ranging from casual dining to fine gastronomic experiences, with menu options that include Italian classics and premium steaks.

Recent Stock Performance

Currently, shares of the full-service dining chain are trading 1.5% below their 52-week high of $210.47. Over the last three months, DRI has seen a 9.9% increase, significantly outpacing the Dow Jones Industrial Average’s ($DOWI) decline of 1.5% during the same period.

On a year-to-date basis, Darden’s stock has grown 11%, exceeding the Dow’s slight gains. Additionally, in the past 52 weeks, DRI shares have surged by 26.8%, compared to the DOWI’s 8.7% return in the same timeframe.

Financial Results and Shareholder Value Initiatives

DRI has maintained its position above the 50-day and 200-day moving averages since August of last year.
Despite reporting weaker-than-expected Q3 2025 results, with adjusted EPS of $2.80 and revenue of $3.2 billion, Darden’s stock rose 5.8% on March 20. This increase was partially driven by the management’s reaffirmation of strong full-year EPS guidance ranging from $9.45 to $9.52. Investors responded positively to a year-over-year EPS growth of 6.9% and plans to open 50 to 55 new restaurants this fiscal year.

The integration of Chuy’s Tex-Mex chain and solid performance from LongHorn Steakhouse, which reported a 2.6% increase in same-restaurant sales, have further contributed to investor confidence.

Furthermore, Darden has returned $53 million through share repurchases, signaling management’s confidence in the company’s financial health and dedication to enhancing shareholder value.

Comparative Market Position

In comparison, Darden has outperformed competitors like Starbucks Corporation (SBUX), which has reported gains of 7.8% over the last year and 6.8% year-to-date.

While DRI has exhibited notable performance, analysts maintain a cautiously optimistic outlook. The stock holds a consensus rating of “Moderate Buy” from the 28 analysts covering it, and it is currently trading below the mean price target of $211.75.

On the date of publication, Sohini Mondal did not hold positions (either directly or indirectly) in any of the securities mentioned. This article serves informational purposes only. For further details, please view the Barchart Disclosure Policy here.

 

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The views expressed herein are solely those of the author and do not necessarily reflect those of Nasdaq, Inc.