Darden Restaurants: At $200 Sit Back And Enjoy Your Dividends

Summary

• Darden Restaurants hit my price target with a 45% total return, driven by strategic menu additions and strong brand performance, especially Olive Garden and LongHorn Steakhouse.
• Despite industry challenges, Darden's Q3 FY 2025 revenue grew 6.16% YoY, with a notable 2.6% same-store sales growth, outperforming the industry average.
• The Uber Direct partnership boosted delivery volume by 40%-50%, and new lean prototypes for Cheddar's and Yard House are accelerating restaurant openings.
• With Darden shares trading near their 5-year average P/E, expect steady returns from dividends and share buybacks but limited short-term capital gains.

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Finally, after babysitting my Darden Restaurants (NYSE:DRI) call for what felt like half a year, we hit the inflection point: the stock finally reached my price target. It's a sweet time, but we got there.

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Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.