Darden Restaurants ‘profitably grew market share’ in its fiscal Q2

Darden Restaurants Inc (NYSE: DRI) says its revenue came in marginally shy of Street estimates in the second quarter. Its shares are down 2.0% at writing.

Darden raises guidance for fiscal 2024

On the plus side, the restaurant operator raised its earnings outlook for the full year to $8.75 to $8.90 on a per-share basis.

Darden Restaurants now expects $11.5 billion in sales in its fiscal 2024. Rick Cardenas – its Chief Executive said in a press release today:

Analysts, in comparison, were at $8.82 a share on $11.6 billion in sales. Darden stock has gained roughly 20% over the past two months.

Darden Restaurants Q2 financial highlights

• Earned $212.1 million versus the year-ago $187.2 million
• Per-share earnings also improved from $1.52 to $1.76
• Adjusted EPS printed at $1.84 as per the press release
• Sales went up 9.7% year-over-year to $2.73 billion
• Consensus was $1.74 a share on $2.74 billion in sales

The food company also announced $1.31 a share of quarterly cash dividend on Friday. CEO Cardenas added:

What else was noteworthy in the earnings report?

Darden Restaurants saw comparable sales at Olive Garden pop 4.1% in its recently concluded quarter while LongHorn Steakhouse gained 4.9%.

The aforementioned positives were partially offset by a 1.7% decline in fine dining sales, as per the earnings report.  

Earlier this year, the New York listed firm acquired Ruth’s Hospitality Group for $715 million as Invezz reported here.

Eric Gonzalez – a KeyBanc analyst reiterated his “overweight” rating on $DRI this week and raised his price objective to $177 which suggests about a 10% upside from here.