Darden Restaurants Inc

Consumer Discretionary
Restaurants
www.darden.com

Earnings Score
Moat Score
Safety Score
Final Score

Market Cap $19.97B
PE 19
Debt $1.68B
Cash $216.90M
EV $21.43B
FCF $1.03B

Earnings

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Sales & Net Margins

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Earnings	$1.04B
EBIT	$1.33B
ROE	49%
ROA	12%
FCF	$1.03B
Equity	$2.14B
Growth Stability	-9%
PE	19.19
PEG	1.73
PB	9.31
P/FCF	19.38
P/S	1.75
Price/Cash	0.01
Debt/Equity	0.78
Debt/FCF	1.63
Net Margins	8%
Gross Margins	20%
Op. Margins	12%
Earnings CAGR	9%
Sales Growth YoY	1%
Sales Growth QoQ	-7%
Sales CAGR	6%
FCF CAGR	6%
Equity CAGR	1%
Earnings Stability	0.64
Earnings Growth YoY	7%
Earnings Growth QoQ	-33%
Earnings CAGR 5Y	11%

Sales CAGR 5Y	11%
FCF CAGR 5Y	22%
Equity CAGR 5Y	-4%
Earnings CAGR 3Y	10%
Sales CAGR 3Y	10%
FCF CAGR 3Y	1%
Equity CAGR 3Y	-3%
Market Cap	$19.97B
Revenue	$11.42B
Dividend Yield	3%
Payout Ratio	61%
Assets	$11.36B
Total Debt	$1.68B
Cash	$216.90M
Shares Outstanding	118.4M
EV	21.43B
Earnings Score	83%
Moat Score	92%
Safety Score	63%
Final Score	79%
Working Capital	-1.51B
Current Ratio	0.35
Gross Profit	$2.26B
Shares Growth 3y	-3%
Equity Growth QoQ	-4%
Equity Growth YoY	-0%

Assets & ROA

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Stockholders Equity & ROE

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Darden Restaurants is the largest restaurant operator in the U.S. full-service space, with consolidated revenue of $9.6 billion in fiscal 2022 resulting in 3%-4% full-service market share (per NRA data and our calculations). The company maintains a portfolio of eight restaurant chains: Olive Garden, LongHorn Steakhouse, Cheddar's Scratch Kitchen, Yard House, The Capital Grille, Seasons 52, Eddie V's, and Bahama Breeze. Darden generates revenue almost exclusively from company-owned restaurants, though a small network of franchised restaurants and consumer-packaged goods sales through the traditional grocery channel contribute modestly.

SEC Filings

Direct access to Darden Restaurants Inc (DRI) Annual Reports (10K) and Quarterly Reports (10Q) from the SEC website.

2024
- 10-Q Aug 25
- 10-K May 26
- 10-Q Feb 25
2023
- 10-Q Nov 26
- 10-Q Aug 27
- 10-K May 28
- 10-Q Feb 26
2022
- 10-Q Nov 27
- 10-Q Aug 28
- 10-K May 29
- 10-Q Feb 27

Sector Comparison

How does Darden Restaurants Inc compare to its competitors?

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Peter Lynch's Chart

This chart shows the current pricing of Darden Restaurants Inc compared to its past. The addition of the earnings trend line provides further insights into the company's earnings power.

CAGR 9%

Stability 64%

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Darden Restaurants Inc Discounted Cash Flow

Fully customizable DCF calculator online for Darden Restaurants Inc.

Years

Calculation mode

= $16B

	0	1	2	3	4	5	6	7	8	9	10	TV
fcf	$1B	$1.1B	$1.2B	$1.2B	$1.3B	$1.4B	$1.5B	$1.6B	$1.7B	$1.8B	$1.9B	$19B
DCF		$995M	$961M	$928M	$896M	$865M	$835M	$807M	$779M	$752M	$726M	$7.3B
Value	$16B

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

Years	05/2015	05/2016	05/2017	05/2018	05/2019	05/2020	05/2021	05/2022	05/2023	05/2024	TTM
Net Margins	10%	5%	7%	7%	8%	-1%	9%	10%	9%	9%	8%
ROA	-	14%	12%	14%	14%	0%	6%	11%	12%	12%	12%
ROE	-	19%	23%	27%	30%	-2%	22%	43%	45%	46%	49%

Net Margins (7.52%)

Net Margins are at a level that is not too high nor too low. They are not a competitive advantage but they are not a competitive disadvantage either.

Safety and Stability

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

Years	05/2015	05/2016	05/2017	05/2018	05/2019	05/2020	05/2021	05/2022	05/2023	05/2024	TTM
Debt over FCF	-	0.76	1.52	1.51	1.15	4.7	1	1.06	0.95	1.5	1.63
Debt over Equity	0.64	0.23	0.45	0.43	0.39	0.52	0.33	0.43	0.43	0.68	0.78
Growth Stability	-	-	-	100%	100%	-9%	100%	100%	100%	100%	-9%

Good Debt/FCF ratio (1.63)

Net Margins are high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Good Debt/Equity ratio (0.78)

The company is not overleveraged and has a good balance between equity and debt.

Bad Graham’s Stability (-9%)

The company has a bad stability in its earnings, which is a sign of a bad competitive advantage.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Years	05/2015	05/2016	05/2017	05/2018	05/2019	05/2020	05/2021	05/2022	05/2023	05/2024	CAGR 5Y
Revenue YoY growth	-	3%	3%	13%	5%	-8%	-8%	34%	9%	9%	11%
Earnings YoY growth	-	-47%	28%	24%	20%	-107%	-1K%	51%	3%	5%	11%
Equity YoY growth	-	-16%	8%	4%	9%	-3%	21%	-22%	0%	2%	-4%
FCF YoY growth	-	2%	6%	-0%	31%	-68%	265%	-5%	11%	3%	22%