The 10-second takeaway
For the quarter ended May 26 (Q4), Darden Restaurants beat slightly on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue grew. Non-GAAP earnings per share dropped. GAAP earnings per share contracted.
Margins shrank across the board.
Darden Restaurants booked revenue of $2.30 billion. The 27 analysts polled by S&P Capital IQ expected to see sales of $2.26 billion on the same basis. GAAP reported sales were 11% higher than the prior-year quarter's $2.07 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 $1.02. The 14 earnings estimates compiled by S&P Capital IQ averaged $1.05 per share. Non-GAAP EPS of $1.02 for Q4 were 11% lower than the prior-year quarter's $1.15 per share. GAAP EPS of $1.01 for Q4 were 12% lower than the prior-year quarter's $1.15 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 22.1%, 190 basis points worse than the prior-year quarter. Operating margin was 8.4%, 270 basis points worse than the prior-year quarter. Net margin was 5.8%, 150 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $2.21 billion. On the bottom line, the average EPS estimate is $0.82.
Next year's average estimate for revenue is $9.11 billion. The average EPS estimate is $3.17.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 406 members out of 529 rating the stock outperform, and 123 members rating it underperform. Among 159 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 138 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 $50.56.
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