Darden Rises on Solid Earnings
Darden Restaurants reported mixed fiscal first-quarter financial results before the markets opened on Tuesday.
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Darden Restaurants Inc. (NYSE: DRI) reported its fiscal first-quarter financial results before the markets opened on Tuesday. The company said that it had $0.88 in earnings per share (EPS) on $1.71 billion in revenue. The same period of the previous year reportedly had EPS of $0.68 and revenue of $1.69 billion. There were consensus estimates from Thomson Reuters of $0.82 in EPS on $1.72 billion in revenue.
During the quarter, Darden repurchased about 3.2 million shares of its common stock for a total cost of approximately $196 million. An additional $4 million in shares were repurchased subsequent to the close of the first quarter, for a total of $200 million in shares repurchased year to date.
Separately, the board of directors authorized a new share repurchase program for an additional $500 million. Keep in mind the total market cap for Darden totals $7.7 billion.
In terms of guidance for the fiscal full year, the company expects to have EPS in the range of $3.80 to $3.90, with same-store sales growing between 1% and 2%. The consensus estimates call for $5.57 billion in revenue.
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Gene Lee, CEO of Darden, commented:
I’m pleased with our performance during the quarter and the progress we made against our strategic initiatives. We continued to gain market share and our same-restaurant sales growth outperformed the industry by a considerable margin. We also returned significant capital to shareholders in the form of our regular dividend and $196 million in share repurchases.
On the books, Darden’s cash and cash equivalents totaled $114.7 million at the end of the quarter, down from $274.8 million at the end of the previous fiscal year.
Shares of Darden closed Monday at $61.36, with a consensus analyst price target of $69.09 and a 52-week trading range of $53.38 to $68.83. Following the release of the earnings report, the stock was up nearly 5% at $64.31 in early trading indications Tuesday.
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Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics. Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications. A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.
