DARDEN RESTAURANTS INC (DRI) Stock Fundamental Analysis
USA - NYSE:DRI - US2371941053 - Common Stock
169.21 USD
-0.79 (-0.46%)
169.21 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. DRI has an excellent profitability rating, but there are some minor concerns on its financial health. DRI has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year DRI was profitable.
DRI had a positive operating cash flow in the past year.
DRI had positive earnings in each of the past 5 years.
DRI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.62%, DRI belongs to the top of the industry, outperforming 80.30% of the companies in the same industry.
DRI has a Return On Equity of 49.43%. This is amongst the best in the industry. DRI outperforms 90.15% of its industry peers.
DRI has a Return On Invested Capital of 12.01%. This is in the better half of the industry: DRI outperforms 77.27% 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 10.61%.
| 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 better Profit Margin (8.90%) than 70.45% of its industry peers.
In the last couple of years the Profit Margin of DRI has declined.
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.
In the last couple of years the Operating Margin of DRI has grown nicely.
Looking at the Gross Margin, with a value of 21.86%, DRI is doing worse than 85.61% of the companies in the same industry.
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.
Compared to 1 year ago, DRI has less shares outstanding
Compared to 5 years ago, DRI has less shares outstanding
The debt/assets ratio for DRI is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.32 indicates that DRI is not a great score, but indicates only limited risk for bankruptcy at the moment.
DRI's Altman-Z score of 2.32 is fine compared to the rest of the industry. DRI outperforms 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.
DRI's Debt to FCF ratio of 3.68 is fine compared to the rest of the industry. DRI outperforms 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.
DRI has a Debt to Equity ratio (1.76) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.76 | ||
| Debt/FCF | 3.68 | ||
| Altman-Z | 2.32 |
ROIC/WACC1.47
WACC8.18%
2.3 Liquidity
A Current Ratio of 0.40 indicates that DRI may have some problems paying its short term obligations.
The Current ratio of DRI (0.40) is worse than 83.33% of its industry peers.
DRI has a Quick 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's Quick ratio of 0.27 is on the low side compared to the rest of the industry. DRI is outperformed by 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.
The Earnings Per Share has been growing by 24.78% on average over the past years. This is a very strong growth
DRI shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.30%.
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
DRI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.68% yearly.
DRI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.58% yearly.
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.
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
The Price/Earnings ratio is 17.30, which indicates a rather expensive current valuation of DRI.
Compared to the rest of the industry, the Price/Earnings ratio of DRI indicates a somewhat cheap valuation: DRI is cheaper than 71.21% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 25.07. DRI is valued slightly cheaper when compared to this.
DRI is valuated correctly with a Price/Forward Earnings ratio of 14.70.
DRI's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. DRI is cheaper than 71.21% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of DRI to the average of the S&P500 Index (34.08), we can say DRI is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.3 | ||
| Fwd PE | 14.7 |
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 the industry average as 73.48% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.43 | ||
| EV/EBITDA | 11.86 |
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)1.42
PEG (5Y)0.7
EPS Next 2Y9.71%
EPS Next 3Y9.68%
5. Dividend
5.1 Amount
DRI has a Yearly Dividend Yield of 3.31%. Purely for dividend investing, there may be better candidates out there.
DRI's Dividend Yield is rather good when compared to the industry average which is at 4.59. DRI pays more dividend than 86.36% of the companies in the same industry.
DRI's Dividend Yield is a higher than the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.31% |
5.2 History
The dividend of DRI is nicely growing with an annual growth rate of 16.99%!
DRI has paid a dividend for at least 10 years, which is 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 3Y9.68%
169.21
-0.79 (-0.46%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners95.22%
Inst Owner Change-3.84%
Ins Owners0.28%
Ins Owner Change11.9%
Market Cap19.68B
Revenue(TTM)12.36B
Net Income(TTM)1.10B
Analysts76.84
Price Target226.24 (33.7%)
Short Float %2.95%
Short Ratio2.51
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.31% |
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)-0.56%
PT rev (3m)-4.64%
EPS NQ rev (1m)0.07%
EPS NQ rev (3m)-4.46%
EPS NY rev (1m)-0.1%
EPS NY rev (3m)-0.66%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)-0.13%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)-0.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.3 | ||
| Fwd PE | 14.7 | ||
| P/S | 1.59 | ||
| P/FCF | 18.43 | ||
| P/OCF | 11.13 | ||
| P/B | 8.84 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.86 |
EPS(TTM)9.78
EY5.78%
EPS(NY)11.51
Fwd EY6.8%
FCF(TTM)9.18
FCFY5.43%
OCF(TTM)15.2
OCFY8.98%
SpS106.31
BVpS19.14
TBVpS-6.7
PEG (NY)1.42
PEG (5Y)0.7
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 | 2.32 |
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 Y12.19%
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 17.3 and the Price/Book (PB) ratio is 8.84.
How financially healthy is DARDEN RESTAURANTS INC?
The financial health rating of DARDEN RESTAURANTS INC (DRI) is 4 / 10.