It looks as if Darden Restaurants
But for growth investors, recent developments point to increased reliance on Darden's two steady-yet-slow-growing concepts. Last evening, the company reported year-end results that saw a number of one-time charges related to closing stores at its Bahama Breeze and Smokey Bones franchises. Overall, sales grew 4%, while continuing earnings advanced 13%, though reported bottom-line results were negative from store-closing and other related impairment costs.
Back in May, Darden closed 54 Smokey Bones barbeque restaurants and plans on selling the remaining 73. It also closed a couple of Rocky River Grillhouse stores. The shuttering of nine Bahama Breezes was merely to close underperforming locations -- management plans to "restart unit growth" off the 23 remaining restaurants.
That leaves Seasons 52, with its fresh grilled food and wine menu, as a potential national chain, but there are currently only five locations. As a result, Darden will remain reliant on Red Lobster and Olive Garden, which each operate over 600 locations throughout North America.
Fellow Fool Timothy Otte recently commended Darden for returning capital to shareholders until "promising internal investment opportunities" show themselves. Based on current developments, Darden has taken a step back from what it thought were two promising concepts in Bahama Breeze and Smokey Bones.
Until a new concept takes off, the company will settle for buying back billions of dollars in stock, which it has done steadily since being spun off from General Mills
In other words, don't count on Darden for jaw-dropping growth going forward. Look to Chipotle
For related Foolishness:
Buffalo Wild Wings is a Motley Fool Hidden Gems selection, and you can learn much more about it with a free 30-day trial subscription. Chipotle is both a Hidden Gems and aRule Breakers recommendation.
Fool contributor Ryan Fuhrmann has no financial interest in any company mentioned. Feel free to email him with feedback or to discuss any companies mentioned further. The Fool has an ironclad disclosure policy.