Darden Restaurants (DRI – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Sara Senatore from Bank of America Securities reiterated a Buy rating on the stock and has a $252.00 price target.
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Sara Senatore has given her Buy rating due to a combination of factors, including the strong performance of Darden Restaurants, particularly Olive Garden, which has shown improved sales growth in recent quarters. This improvement suggests potential upside to the same-store sales growth estimates, surpassing consensus expectations. Additionally, the company has demonstrated better operating leverage, particularly in restaurant labor, which has positively impacted earnings per share estimates for both the current and upcoming fiscal years.
Sara Senatore also notes Darden’s historical pattern of conservative guidance at the start of the fiscal year, which is typically followed by exceeding and raising guidance as the year progresses. This approach aligns with the company’s long-term growth strategy, which includes modest new unit growth and margin expansion. The price objective for Darden Restaurants has been raised to $252, reflecting these higher estimates and the company’s current trading position relative to the S&P 500. As a result, the Buy rating is reiterated.
In another report released yesterday, Evercore ISI also maintained a Buy rating on the stock with a $250.00 price target.