In the latest trading session, Darden Restaurants (DRI) closed at $121.16, marking a +0.42% move from the previous day. This move lagged the S&P 500's daily gain of 1.5%. At the same time, the Dow added 1.48%, and the tech-heavy Nasdaq gained 1.95%.
Heading into today, shares of the owner of Olive Garden and other chain restaurants had lost 3.79% over the past month, outpacing the Retail-Wholesale sector's loss of 6.26% and the S&P 500's loss of 4.19% in that time.
Investors will be hoping for strength from DRI as it approaches its next earnings release. In that report, analysts expect DRI to post earnings of $1.36 per share. This would mark year-over-year growth of 1.49%. Meanwhile, our latest consensus estimate is calling for revenue of $2.14 billion, up 3.66% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $6.39 per share and revenue of $9.04 billion, which would represent changes of +9.79% and +6.22%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for DRI. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.01% lower within the past month. DRI is currently sporting a Zacks Rank of #3 (Hold).
In terms of valuation, DRI is currently trading at a Forward P/E ratio of 18.89. This represents a discount compared to its industry's average Forward P/E of 23.42.
Investors should also note that DRI has a PEG ratio of 1.87 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Restaurants industry currently had an average PEG ratio of 2.16 as of yesterday's close.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 74, putting it in the top 29% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.