DARDEN RESTAURANTS INC (DRI) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DRI - US2371941053 - Common Stock
180 USD
+0.72 (+0.4%)
180 USD
0 (0%)
Overall DRI gets a fundamental rating of 5 out of 10. We evaluated DRI against 132 industry peers in the Hotels, Restaurants & Leisure industry. While DRI belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. DRI is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year DRI was profitable.
DRI had a positive operating cash flow in the past year.
Each year in the past 5 years DRI has been profitable.
Each year in the past 5 years DRI had a positive operating cash flow.
1.2 Ratios
DRI's Return On Assets of 8.62% is fine compared to the rest of the industry. DRI outperforms 79.55% of its industry peers.
DRI has a Return On Equity of 49.43%. This is amongst the best in the industry. DRI outperforms 90.91% of its industry peers.
With a decent Return On Invested Capital value of 12.01%, DRI is doing good in the industry, outperforming 77.27% of the companies in the same industry.
DRI had an Average Return On Invested Capital over the past 3 years of 12.45%. This is above the industry average of 10.41%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.62% | ||
| ROE | 49.43% | ||
| ROIC | 12.01% |
ROA(3y)9%
ROA(5y)8.46%
ROE(3y)45.28%
ROE(5y)40.31%
ROIC(3y)12.45%
ROIC(5y)11.32%
1.3 Margins
DRI has a Profit Margin of 8.90%. This is in the better half of the industry: DRI outperforms 68.94% of its industry peers.
DRI's Profit Margin has declined in the last couple of years.
DRI has a Operating Margin of 11.63%. This is in the better half of the industry: DRI outperforms 62.88% of its industry peers.
DRI's Operating Margin has improved in the last couple of years.
DRI has a Gross Margin of 21.86%. This is amonst the worse of the industry: DRI underperforms 84.85% of its industry peers.
DRI's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.63% | ||
| PM (TTM) | 8.9% | ||
| GM | 21.86% |
OM growth 3Y-1.01%
OM growth 5Y15.81%
PM growth 3Y-4.23%
PM growth 5YN/A
GM growth 3Y1.84%
GM growth 5Y3.94%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so DRI is still creating some value.
The number of shares outstanding for DRI has been reduced compared to 1 year ago.
DRI has less shares outstanding than it did 5 years ago.
The debt/assets ratio for DRI is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.39 indicates that DRI is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.39, DRI is in the better half of the industry, outperforming 65.15% of the companies in the same industry.
DRI has a debt to FCF ratio of 3.68. This is a good value and a sign of high solvency as DRI would need 3.68 years to pay back of all of its debts.
The Debt to FCF ratio of DRI (3.68) is better than 78.79% of its industry peers.
A Debt/Equity ratio of 1.76 is on the high side and indicates that DRI has dependencies on debt financing.
The Debt to Equity ratio of DRI (1.76) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.76 | ||
| Debt/FCF | 3.68 | ||
| Altman-Z | 2.39 |
ROIC/WACC1.48
WACC8.1%
2.3 Liquidity
A Current Ratio of 0.40 indicates that DRI may have some problems paying its short term obligations.
DRI has a worse Current ratio (0.40) than 82.58% of its industry peers.
A Quick Ratio of 0.27 indicates that DRI may have some problems paying its short term obligations.
DRI has a Quick ratio of 0.27. This is amonst the worse of the industry: DRI underperforms 88.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.4 | ||
| Quick Ratio | 0.27 |
3. Growth
3.1 Past
DRI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.38%, which is quite good.
Measured over the past years, DRI shows a very strong growth in Earnings Per Share. The EPS has been growing by 24.78% on average per year.
The Revenue has grown by 8.30% in the past year. This is quite good.
Measured over the past years, DRI shows a quite strong growth in Revenue. The Revenue has been growing by 9.12% on average per year.
EPS 1Y (TTM)10.38%
EPS 3Y8.81%
EPS 5Y24.78%
EPS Q2Q%12.57%
Revenue 1Y (TTM)8.3%
Revenue growth 3Y7.84%
Revenue growth 5Y9.12%
Sales Q2Q%10.44%
3.2 Future
The Earnings Per Share is expected to grow by 8.68% on average over the next years. This is quite good.
Based on estimates for the next years, DRI will show a small growth in Revenue. The Revenue will grow by 5.58% on average per year.
EPS Next Y12.19%
EPS Next 2Y9.71%
EPS Next 3Y9.68%
EPS Next 5Y8.68%
Revenue Next Year8.27%
Revenue Next 2Y5.99%
Revenue Next 3Y5.81%
Revenue Next 5Y5.58%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 18.40 indicates a rather expensive valuation of DRI.
DRI's Price/Earnings ratio is a bit cheaper when compared to the industry. DRI is cheaper than 71.21% of the companies in the same industry.
DRI's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.15.
DRI is valuated correctly with a Price/Forward Earnings ratio of 15.64.
71.97% of the companies in the same industry are more expensive than DRI, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.12, DRI is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.4 | ||
| Fwd PE | 15.64 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DRI is on the same level as its industry peers.
Based on the Price/Free Cash Flow ratio, DRI is valued a bit cheaper than the industry average as 70.45% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.61 | ||
| EV/EBITDA | 12.45 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of DRI may justify a higher PE ratio.
PEG (NY)1.51
PEG (5Y)0.74
EPS Next 2Y9.71%
EPS Next 3Y9.68%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.43%, DRI has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 6.38, DRI pays a better dividend. On top of this DRI pays more dividend than 85.61% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.41, DRI pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.43% |
5.2 History
On average, the dividend of DRI grows each year by 16.99%, which is quite nice.
DRI has paid a dividend for at least 10 years, which is a reliable track record.
DRI has decreased its dividend recently.
Dividend Growth(5Y)16.99%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
DRI pays out 60.69% of its income as dividend. This is not a sustainable payout ratio.
The dividend of DRI is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP60.69%
EPS Next 2Y9.71%
EPS Next 3Y9.68%
180
+0.72 (+0.4%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners95.22%
Inst Owner Change-3.87%
Ins Owners0.28%
Ins Owner Change8.92%
Market Cap20.94B
Revenue(TTM)12.36B
Net Income(TTM)1.10B
Analysts76.84
Price Target225.22 (25.12%)
Short Float %2.95%
Short Ratio2.51
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.43% |
Yearly Dividend5.58
Dividend Growth(5Y)16.99%
DP60.69%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-1.61%
Min EPS beat(2)-2.55%
Max EPS beat(2)-0.66%
EPS beat(4)0
Avg EPS beat(4)-1.12%
Min EPS beat(4)-2.55%
Max EPS beat(4)-0.42%
EPS beat(8)2
Avg EPS beat(8)-0.71%
EPS beat(12)6
Avg EPS beat(12)0.34%
EPS beat(16)8
Avg EPS beat(16)-0.28%
Revenue beat(2)0
Avg Revenue beat(2)-0.75%
Min Revenue beat(2)-0.82%
Max Revenue beat(2)-0.68%
Revenue beat(4)0
Avg Revenue beat(4)-1.38%
Min Revenue beat(4)-2.74%
Max Revenue beat(4)-0.68%
Revenue beat(8)0
Avg Revenue beat(8)-1.7%
Revenue beat(12)2
Avg Revenue beat(12)-1.05%
Revenue beat(16)4
Avg Revenue beat(16)-0.97%
PT rev (1m)-1.01%
PT rev (3m)-5.07%
EPS NQ rev (1m)0.07%
EPS NQ rev (3m)-4.46%
EPS NY rev (1m)0.01%
EPS NY rev (3m)-0.66%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)-0.13%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.4 | ||
| Fwd PE | 15.64 | ||
| P/S | 1.69 | ||
| P/FCF | 19.61 | ||
| P/OCF | 11.84 | ||
| P/B | 9.41 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.45 |
EPS(TTM)9.78
EY5.43%
EPS(NY)11.51
Fwd EY6.39%
FCF(TTM)9.18
FCFY5.1%
OCF(TTM)15.2
OCFY8.44%
SpS106.31
BVpS19.14
TBVpS-6.7
PEG (NY)1.51
PEG (5Y)0.74
Graham Number64.89
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.62% | ||
| ROE | 49.43% | ||
| ROCE | 13.81% | ||
| ROIC | 12.01% | ||
| ROICexc | 12.25% | ||
| ROICexgc | 17.27% | ||
| OM | 11.63% | ||
| PM (TTM) | 8.9% | ||
| GM | 21.86% | ||
| FCFM | 8.64% |
ROA(3y)9%
ROA(5y)8.46%
ROE(3y)45.28%
ROE(5y)40.31%
ROIC(3y)12.45%
ROIC(5y)11.32%
ROICexc(3y)12.83%
ROICexc(5y)11.9%
ROICexgc(3y)17.84%
ROICexgc(5y)16.28%
ROCE(3y)14.18%
ROCE(5y)12.88%
ROICexgc growth 3Y1.15%
ROICexgc growth 5Y21.42%
ROICexc growth 3Y-1.77%
ROICexc growth 5Y19.57%
OM growth 3Y-1.01%
OM growth 5Y15.81%
PM growth 3Y-4.23%
PM growth 5YN/A
GM growth 3Y1.84%
GM growth 5Y3.94%
F-Score6
Asset Turnover0.97
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.76 | ||
| Debt/FCF | 3.68 | ||
| Debt/EBITDA | 1.99 | ||
| Cap/Depr | 132.15% | ||
| Cap/Sales | 5.66% | ||
| Interest Coverage | 8.46 | ||
| Cash Conversion | 89.82% | ||
| Profit Quality | 97.06% | ||
| Current Ratio | 0.4 | ||
| Quick Ratio | 0.27 | ||
| Altman-Z | 2.39 |
F-Score6
WACC8.1%
ROIC/WACC1.48
Cap/Depr(3y)140.02%
Cap/Depr(5y)121.27%
Cap/Sales(3y)5.58%
Cap/Sales(5y)4.94%
Profit Quality(3y)96.8%
Profit Quality(5y)105.36%
High Growth Momentum
Growth
EPS 1Y (TTM)10.38%
EPS 3Y8.81%
EPS 5Y24.78%
EPS Q2Q%12.57%
EPS Next Y12.19%
EPS Next 2Y9.71%
EPS Next 3Y9.68%
EPS Next 5Y8.68%
Revenue 1Y (TTM)8.3%
Revenue growth 3Y7.84%
Revenue growth 5Y9.12%
Sales Q2Q%10.44%
Revenue Next Year8.27%
Revenue Next 2Y5.99%
Revenue Next 3Y5.81%
Revenue Next 5Y5.58%
EBIT growth 1Y5.74%
EBIT growth 3Y6.75%
EBIT growth 5Y26.36%
EBIT Next Year48.65%
EBIT Next 3Y17.93%
EBIT Next 5Y12.43%
FCF growth 1Y39.47%
FCF growth 3Y6.34%
FCF growth 5Y35.25%
OCF growth 1Y27.42%
OCF growth 3Y10.58%
OCF growth 5Y19.02%
DARDEN RESTAURANTS INC / DRI FAQ
Can you provide the ChartMill fundamental rating for DARDEN RESTAURANTS INC?
ChartMill assigns a fundamental rating of 5 / 10 to DRI.
What is the valuation status of DARDEN RESTAURANTS INC (DRI) stock?
ChartMill assigns a valuation rating of 5 / 10 to DARDEN RESTAURANTS INC (DRI). This can be considered as Fairly Valued.
Can you provide the profitability details for DARDEN RESTAURANTS INC?
DARDEN RESTAURANTS INC (DRI) has a profitability rating of 7 / 10.
What is the valuation of DARDEN RESTAURANTS INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for DARDEN RESTAURANTS INC (DRI) is 18.4 and the Price/Book (PB) ratio is 9.41.
How financially healthy is DARDEN RESTAURANTS INC?
The financial health rating of DARDEN RESTAURANTS INC (DRI) is 4 / 10.