Darden Restaurants Increases Sales but Misses Revenue Estimates

Seth Jayson, The Motley Fool
Updated

Darden Restaurants (NYS: DRI) reported earnings on June 22. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended May 27 (Q4), Darden Restaurants missed estimates on revenues and met expectations on earnings per share.

Compared to the prior-year quarter, revenue expanded and GAAP earnings per share increased significantly.


Margins increased across the board.

Revenue details
Darden Restaurants reported revenue of $2.07 billion. The 24 analysts polled by S&P Capital IQ expected to see sales of $2.11 billion on the same basis. GAAP reported sales were 3.8% higher than the prior-year quarter's $1.99 billion.

anImage
anImage

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.15. The 25 earnings estimates compiled by S&P Capital IQ anticipated $1.15 per share. GAAP EPS of $1.15 for Q4 were 16% higher than the prior-year quarter's $0.99 per share.

anImage
anImage

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 24.1%, 20 basis points better than the prior-year quarter. Operating margin was 11.0%, 30 basis points better than the prior-year quarter. Net margin was 7.3%, 40 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $2.03 billion. On the bottom line, the average EPS estimate is $0.85.

Next year's average estimate for revenue is $8.49 billion. The average EPS estimate is $3.94.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 378 members out of 494 rating the stock outperform, and 116 members rating it underperform. Among 151 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 125 give Darden Restaurants a green thumbs-up, and 26 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Darden Restaurants is outperform, with an average price target of $56.43.

Can your portfolio provide you with enough income to last through retirement? You'll need more than Darden Restaurants. Learn how to maximize your investment income and "Secure Your Future With 9 Rock-Solid Dividend Stocks." Click here for instant access to this free report.

The article Darden Restaurants Increases Sales but Misses Revenue Estimates originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Darden Restaurants. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Advertisement