Dec. 19, 2013, 7:32 AM
- Darden Restaurants (DRI) reports a blended same-restaurant sales slip of 1.0% in FQ2 for its Olive Garden, Red Lobster, and Longhorn Steakhouse chains.
- The company says a shift in the timing of Thanksgiving impacted same-restaurant sales favorably by 90 bps during the period.
- Olive Garden was the best-performing brand as lower expenses helped it see profit increase compared to a year ago, while the other two chains saw profits worsen. (PR)
- DRI -5.5% premarket
Dec. 19, 2013, 7:09 AM| 1 Comment
Dec. 19, 2013, 12:05 AM
Dec. 18, 2013, 5:30 PM
Dec. 17, 2013, 9:33 AM
- 2.8% shareholder Barington Capital escalates its activist posture towards Darden Restaurants (DRI +1.3%), issuing an 84-page presentation stating its belief that Darden's "corporate centralization and resulting internal complexity have contributed to the Company's declining financial performance and eroding competitive position."
- Barington believes $71-$80/share in value could be unlocked if the company is split into "Darden-Mature" (Olive Garden and Red Lobster) and "Darden Higher-Growth" (Bahama Breeze, Longhorne Steakhouse, Seasons 32, Eddie V's, Yard House, and The Capital Grille) and the real estate assets, which Barington believes are valued at $4B, are divested. The respective companies would then be run more in-line with value and growth companies respectively, Barington recommends. The points have been a general theme of Barington's agitation in the past several months.
- And although Barington is encouraged by Darden's proposed $50M in cost cutting efforts, the fund thinks the restaurateur "has numerous actionable avenues to lower operating expenses by up to $100M-$150M."
- Barington has hired a proxy solicitation firm and Houlihan Lokey to review its recommendations in a sign that the fund may be willing to go to bat to push through its recommendations.
Dec. 2, 2013, 2:14 PM
- National Restaurant Association's Restaurant Performance Index increased 0.7% M/M in October to track at a four-month high.
- Customer traffic improved during the month with more restaurant operators reporting a rise than a drop.
- Pricing in the restaurant sector has held up better than some other discretionary areas where promotional activity has taken over.
- Related stocks: CAKE, CBRL, CMG, DNKN, DPZ, DRI, EAT, JACK, MCD, PNRA, RRGB, RT, SONC, WEN, BWLD, THI, BDL, NATH, CEC, LUB, BKW, CHUY, BLMN, PZZA, TXRH, DENN, KKD, BBRG, DFRG, BOBE, RUTH, IRG, DIN.
Dec. 2, 2013, 1:25 PM
- The Olive Garden restaurant chain will start selling six-ounce hamburgers after research showed it was losing customers to burger-selling rivals in the family dining category of the industry.
- The Darden Restaurant (DRI -0.5%) property tested a few burger concepts earlier this year before coming up with the revelation that the burger needed a companion. Enter french fries to the Olive Garden menu.
- What to watch: The burger play looks ill-fated to some analysts with the Olive Garden brand entrenched as an Italian food option.
Nov. 11, 2013, 9:56 AM| Comment!
Oct. 15, 2013, 8:09 AM
- It's very early in the earnings season, but restaurant operators are 0 for 5 in meeting the Q3 estimates of analysts, observes Hedgeye.
- Domino's Pizza which is considered one of the more resilient chains to consumer spending swings was the latest to swing and miss.
- The sector has been tapped as one of the potential casualties from the government shutdown with family dining operators expected to take the hardest hit.
- Earnings watch: CAKE, CBRL, CMG, DNKN, DRI, EAT, JACK, MCD, PNRA, RRGB, RT, SONC, WEN, BWLD, THI, BDL, BKW, TXRH, DENN, KKD, BBRG, DFRG, BOBE, RUTH, IRG, DIN
Oct. 9, 2013, 2:33 PM
- Darden Restaurants (DRI +6.1%) shoots higher after chatter picks up that Barrington Research has piled up a 2.8% stake in the company.
- CNBC reports the investment firm will push for a breakup of the restaurant operator into one entity with newer high-growth chains and another operating the well-known Red Lobster and Olive Garden chains.
Oct. 2, 2013, 12:16 PM
- "The review for downgrade reflects Darden's (DRI -0.9%) weaker than expected earnings generation, particularly since its debt-financed acquisition of Yard House that has resulted in a steady deterioration in debt protection metrics as well as our view that soft consumer spending and discounting by competitors will limit the company's ability to materially improve earnings and credit metrics over the intermediate term," says Moody's Senior Credit Officer Bill Fahy.
- Moody's doesn't expect more than a one-notch move from the current Baa2 rating, and would then likely restore Darden's credit outlook to Stable.
Sep. 20, 2013, 7:50 AM
Sep. 20, 2013, 7:47 AM
- Darden Restaurants (DRI) reports a blended same-restaurant sales decline of 3.3% for its Olive Garden, Red Lobster, and LongHorn Steakhouse chains in FQ1 as higher prices couldn't offset soft traffic patterns.
- The company says that after conducting a review it has decided to take steps to reduce expenses by $50M through job and spending cuts. (PR)
- DRI -3.5% premarket.
Sep. 20, 2013, 7:34 AM
Sep. 20, 2013, 7:32 AM| Comment!
Sep. 20, 2013, 12:05 AM
DRI vs. ETF Alternatives
Darden Restaurants Inc owns and operates dining restaurants. Some of its trade names are Red Lobster, Olive Garden, LongHorn Steakhouse, Bahama Breeze, Seasons 52, Eddie V's Prime Seafood, Wildfish Seafood Grille and Yard House.
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