DARDEN RESTAURANTS INC (DRI) Stock Fundamental Analysis
USA - NYSE:DRI - US2371941053 - Common Stock
178.06 USD
+0.55 (+0.31%)
178.06 USD
0 (0%)
DRI gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 132 industry peers in the Hotels, Restaurants & Leisure industry. While DRI has a great profitability rating, there are some minor concerns on its financial health. DRI has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year DRI was profitable.
In the past year DRI had a positive cash flow from operations.
DRI had positive earnings in each of the past 5 years.
Each year in the past 5 years DRI had a positive operating cash flow.
1.2 Ratios
DRI has a better Return On Assets (8.62%) than 81.82% of its industry peers.
DRI has a Return On Equity of 49.43%. This is amongst the best in the industry. DRI outperforms 91.67% of its industry peers.
DRI's Return On Invested Capital of 12.01% is fine compared to the rest of the industry. DRI outperforms 78.03% of its industry peers.
The Average Return On Invested Capital over the past 3 years for DRI is in line with the industry average of 10.78%.
| 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
The Profit Margin of DRI (8.90%) is better than 71.21% of its industry peers.
In the last couple of years the Profit Margin of DRI has declined.
The Operating Margin of DRI (11.63%) is better than 62.88% of its industry peers.
In the last couple of years the Operating Margin of DRI has grown nicely.
DRI has a worse Gross Margin (21.86%) than 84.85% of its industry peers.
In the last couple of years the Gross Margin of DRI has grown nicely.
| 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), DRI is creating some value.
The number of shares outstanding for DRI has been reduced compared to 1 year ago.
The number of shares outstanding for DRI has been reduced compared to 5 years ago.
The debt/assets ratio for DRI is higher compared to a year ago.
2.2 Solvency
DRI has an Altman-Z score of 2.37. This is not the best score and indicates that DRI is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of DRI (2.37) is better than 65.91% of its industry peers.
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 80.30% of its industry peers.
DRI has a Debt/Equity ratio of 1.76. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.76, DRI perfoms like the industry average, outperforming 53.79% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.76 | ||
| Debt/FCF | 3.68 | ||
| Altman-Z | 2.37 |
ROIC/WACC1.47
WACC8.18%
2.3 Liquidity
DRI has a Current Ratio of 0.40. This is a bad value and indicates that DRI is not financially healthy enough and could expect problems in meeting its short term obligations.
DRI has a Current ratio of 0.40. This is amonst the worse of the industry: DRI underperforms 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 worse Quick ratio (0.27) than 87.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.4 | ||
| Quick Ratio | 0.27 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 10.38% over the past year.
DRI shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 24.78% yearly.
DRI shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.30%.
The Revenue has been growing by 9.12% on average over the past years. This is quite good.
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.
The Revenue is expected to grow by 5.58% on average over the next years.
EPS Next Y12.18%
EPS Next 2Y9.71%
EPS Next 3Y9.66%
EPS Next 5Y8.68%
Revenue Next Year8.26%
Revenue Next 2Y6%
Revenue Next 3Y5.83%
Revenue Next 5Y5.58%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
DRI is valuated rather expensively with a Price/Earnings ratio of 18.21.
Based on the Price/Earnings ratio, DRI is valued a bit cheaper than 68.94% of the companies in the same industry.
When comparing the Price/Earnings ratio of DRI to the average of the S&P500 Index (25.83), we can say DRI is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 15.47, the valuation of DRI can be described as correct.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DRI indicates a somewhat cheap valuation: DRI is cheaper than 69.70% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 32.68. DRI is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.21 | ||
| Fwd PE | 15.47 |
4.2 Price Multiples
DRI's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, DRI is valued a bit cheaper than 72.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.4 | ||
| EV/EBITDA | 12.31 |
4.3 Compensation for Growth
DRI's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
DRI has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.49
PEG (5Y)0.73
EPS Next 2Y9.71%
EPS Next 3Y9.66%
5. Dividend
5.1 Amount
DRI has a Yearly Dividend Yield of 3.25%.
Compared to an average industry Dividend Yield of 4.33, DRI pays a better dividend. On top of this DRI pays more dividend than 85.61% of the companies listed in the same industry.
DRI's Dividend Yield is a higher than the S&P500 average which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.25% |
5.2 History
The dividend of DRI is nicely growing with an annual growth rate of 16.99%!
DRI has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of DRI decreased recently.
Dividend Growth(5Y)16.99%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
60.69% of the earnings are spent on dividend by DRI. 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 3Y9.66%
178.06
+0.55 (+0.31%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners95.22%
Inst Owner Change-2.97%
Ins Owners0.28%
Ins Owner Change8.85%
Market Cap20.71B
Revenue(TTM)12.36B
Net Income(TTM)1.10B
Analysts76.76
Price Target226.24 (27.06%)
Short Float %2.89%
Short Ratio2.77
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.25% |
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)-4.54%
PT rev (3m)-4.59%
EPS NQ rev (1m)0.41%
EPS NQ rev (3m)-4.46%
EPS NY rev (1m)-0.11%
EPS NY rev (3m)-0.67%
Revenue NQ rev (1m)0.13%
Revenue NQ rev (3m)-0.16%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)-0.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.21 | ||
| Fwd PE | 15.47 | ||
| P/S | 1.67 | ||
| P/FCF | 19.4 | ||
| P/OCF | 11.72 | ||
| P/B | 9.31 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.31 |
EPS(TTM)9.78
EY5.49%
EPS(NY)11.51
Fwd EY6.46%
FCF(TTM)9.18
FCFY5.16%
OCF(TTM)15.2
OCFY8.54%
SpS106.31
BVpS19.14
TBVpS-6.7
PEG (NY)1.49
PEG (5Y)0.73
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 | 2.37 |
F-Score6
WACC8.18%
ROIC/WACC1.47
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 Y12.18%
EPS Next 2Y9.71%
EPS Next 3Y9.66%
EPS Next 5Y8.68%
Revenue 1Y (TTM)8.3%
Revenue growth 3Y7.84%
Revenue growth 5Y9.12%
Sales Q2Q%10.44%
Revenue Next Year8.26%
Revenue Next 2Y6%
Revenue Next 3Y5.83%
Revenue Next 5Y5.58%
EBIT growth 1Y5.74%
EBIT growth 3Y6.75%
EBIT growth 5Y26.36%
EBIT Next Year48.65%
EBIT Next 3Y17.97%
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 18.21 and the Price/Book (PB) ratio is 9.31.
How financially healthy is DARDEN RESTAURANTS INC?
The financial health rating of DARDEN RESTAURANTS INC (DRI) is 4 / 10.