Darden Restaurants Analysts Cut Their Forecasts After Q3 Results
Portfolio Pulse from Avi Kapoor
Darden Restaurants Inc (NYSE:DRI) reported Q3 FY24 sales of $2.975 billion, missing estimates, with a 6.8% Y/Y growth. Adjusted EPS was $2.62, in line with expectations. FY24 sales forecast was revised to $11.4 billion from $11.5 billion, with same-restaurant sales growth expectations lowered to 1.5%-2%. Following the earnings announcement, analysts from Citigroup, JP Morgan, Morgan Stanley, Wedbush, and Oppenheimer adjusted their price targets on DRI, all maintaining positive ratings but lowering their price targets. DRI shares rose 0.9% to $164.75.
March 22, 2024 | 6:58 pm
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NEUTRAL IMPACT
Darden Restaurants reported lower than expected Q3 sales but met EPS estimates. FY24 sales and same-restaurant sales growth forecasts were revised downwards. Despite this, shares rose 0.9% and analysts maintained positive ratings but lowered price targets.
The mixed Q3 results and adjusted FY24 outlook could have a neutral short-term impact on DRI's stock price. While the sales miss and lowered forecasts might concern investors, the maintenance of positive ratings by analysts and the slight increase in share price indicate a balanced market reaction. The adjustments in analysts' price targets reflect a recalibration of expectations rather than a negative outlook.
CONFIDENCE 90
IMPORTANCE 75
RELEVANCE 100