The 10-second takeaway
For the quarter ended Nov. 25 (Q2), Darden Restaurants met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share dropped significantly.
Margins contracted across the board.
Darden Restaurants logged revenue of $1.96 billion. The 25 analysts polled by S&P Capital IQ looked for revenue of $1.95 billion on the same basis. GAAP reported sales were 7.0% higher than the prior-year quarter's $1.83 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.26. The 29 earnings estimates compiled by S&P Capital IQ predicted $0.27 per share. GAAP EPS of $0.26 for Q2 were 37% lower than the prior-year quarter's $0.41 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 20.0%, 30 basis points worse than the prior-year quarter. Operating margin was 3.9%, 140 basis points worse than the prior-year quarter. Net margin was 1.7%, 120 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.32 billion. On the bottom line, the average EPS estimate is $1.13.
Next year's average estimate for revenue is $8.60 billion. The average EPS estimate is $3.41.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 389 members out of 508 rating the stock outperform, and 119 members rating it underperform. Among 140 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 119 give Darden Restaurants a green thumbs-up, and 21 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Darden Restaurants is hold, with an average price target of $60.00.
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