DARDEN RESTAURANTS INC (DRI) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DRI - US2371941053 - Common Stock
187.24 USD
-2.02 (-1.07%)
We assign a fundamental rating of 5 out of 10 to DRI. DRI was compared to 133 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 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.
In the past year DRI had a positive cash flow from operations.
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 has a better Return On Assets (8.67%) than 79.70% of its industry peers.
The Return On Equity of DRI (53.94%) is better than 90.98% of its industry peers.
DRI's Return On Invested Capital of 12.02% is fine compared to the rest of the industry. DRI outperforms 77.44% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DRI is above the industry average of 10.41%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.67% | ||
| ROE | 53.94% | ||
| ROIC | 12.02% |
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 8.92%. This is in the better half of the industry: DRI outperforms 69.17% of its industry peers.
In the last couple of years the Profit Margin of DRI has declined.
DRI has a better Operating Margin (11.64%) than 63.16% of its industry peers.
In the last couple of years the Operating Margin of DRI has grown nicely.
DRI has a Gross Margin of 21.63%. This is amonst the worse of the industry: DRI underperforms 84.96% of its industry peers.
DRI's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.64% | ||
| PM (TTM) | 8.92% | ||
| GM | 21.63% |
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.
DRI has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, DRI has a worse debt to assets ratio.
2.2 Solvency
DRI has an Altman-Z score of 2.39. 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.
With a decent Altman-Z score value of 2.39, DRI is doing good in the industry, outperforming 64.66% of the companies in the same industry.
The Debt to FCF ratio of DRI is 2.67, which is a good value as it means it would take DRI, 2.67 years of fcf income to pay off all of its debts.
DRI has a better Debt to FCF ratio (2.67) than 81.20% of its industry peers.
A Debt/Equity ratio of 1.24 is on the high side and indicates that DRI has dependencies on debt financing.
DRI has a Debt to Equity ratio (1.24) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.24 | ||
| Debt/FCF | 2.67 | ||
| Altman-Z | 2.39 |
ROIC/WACC1.43
WACC8.38%
2.3 Liquidity
DRI has a Current Ratio of 0.39. 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 Current ratio of 0.39 is on the low side compared to the rest of the industry. DRI is outperformed by 81.95% of its industry peers.
DRI has a Quick Ratio of 0.39. 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 Quick ratio of 0.26. This is amonst the worse of the industry: DRI underperforms 87.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.39 | ||
| Quick Ratio | 0.26 |
3. Growth
3.1 Past
DRI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.62%, 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 8.61% in the past year. This is quite good.
DRI shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.12% yearly.
EPS 1Y (TTM)8.62%
EPS 3Y8.81%
EPS 5Y24.78%
EPS Q2Q%2.46%
Revenue 1Y (TTM)8.61%
Revenue growth 3Y7.84%
Revenue growth 5Y9.12%
Sales Q2Q%7.34%
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 Y11.76%
EPS Next 2Y9.62%
EPS Next 3Y9.63%
EPS Next 5Y8.68%
Revenue Next Year8.84%
Revenue Next 2Y6.39%
Revenue Next 3Y6.07%
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.
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
With a Price/Earnings ratio of 19.05, DRI is valued on the expensive side.
Based on the Price/Earnings ratio, DRI is valued a bit cheaper than the industry average as 72.93% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of DRI to the average of the S&P500 Index (26.61), we can say DRI is valued slightly cheaper.
DRI is valuated correctly with a Price/Forward Earnings ratio of 16.30.
Based on the Price/Forward Earnings ratio, DRI is valued a bit cheaper than the industry average as 72.93% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 24.01. DRI is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.05 | ||
| Fwd PE | 16.3 |
4.2 Price Multiples
DRI's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of DRI indicates a somewhat cheap valuation: DRI is cheaper than 69.17% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.52 | ||
| EV/EBITDA | 11.94 |
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)1.62
PEG (5Y)0.77
EPS Next 2Y9.62%
EPS Next 3Y9.63%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.11%, DRI has a reasonable but not impressive dividend return.
DRI's Dividend Yield is rather good when compared to the industry average which is at 1.54. DRI pays more dividend than 87.97% of the companies in the same industry.
DRI's Dividend Yield is rather good when compared to the S&P500 average which is at 1.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.11% |
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
60.33% 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.
DP60.33%
EPS Next 2Y9.62%
EPS Next 3Y9.63%
NYSE:DRI (12/23/2025, 9:47:06 AM)
187.24
-2.02 (-1.07%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners94.67%
Inst Owner Change-3.58%
Ins Owners0.28%
Ins Owner Change8.92%
Market Cap21.78B
Revenue(TTM)12.58B
Net Income(TTM)1.12B
Analysts77.3
Price Target223.78 (19.52%)
Short Float %3.43%
Short Ratio3.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.11% |
Yearly Dividend5.58
Dividend Growth(5Y)16.99%
DP60.33%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-2.3%
Min EPS beat(2)-2.55%
Max EPS beat(2)-2.05%
EPS beat(4)0
Avg EPS beat(4)-1.53%
Min EPS beat(4)-2.55%
Max EPS beat(4)-0.66%
EPS beat(8)1
Avg EPS beat(8)-1.59%
EPS beat(12)5
Avg EPS beat(12)-0.23%
EPS beat(16)7
Avg EPS beat(16)-0.57%
Revenue beat(2)1
Avg Revenue beat(2)-0.41%
Min Revenue beat(2)-0.82%
Max Revenue beat(2)0%
Revenue beat(4)1
Avg Revenue beat(4)-1.06%
Min Revenue beat(4)-2.74%
Max Revenue beat(4)0%
Revenue beat(8)1
Avg Revenue beat(8)-1.52%
Revenue beat(12)2
Avg Revenue beat(12)-1.16%
Revenue beat(16)4
Avg Revenue beat(16)-1.03%
PT rev (1m)-0.64%
PT rev (3m)-5.15%
EPS NQ rev (1m)-0.3%
EPS NQ rev (3m)-4.68%
EPS NY rev (1m)-0.04%
EPS NY rev (3m)-0.7%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)-0.06%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)-0.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.05 | ||
| Fwd PE | 16.3 | ||
| P/S | 1.73 | ||
| P/FCF | 22.52 | ||
| P/OCF | 12.81 | ||
| P/B | 10.47 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.94 |
EPS(TTM)9.83
EY5.25%
EPS(NY)11.49
Fwd EY6.13%
FCF(TTM)8.31
FCFY4.44%
OCF(TTM)14.61
OCFY7.8%
SpS108.13
BVpS17.89
TBVpS-7.95
PEG (NY)1.62
PEG (5Y)0.77
Graham Number62.9
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.67% | ||
| ROE | 53.94% | ||
| ROCE | 14.23% | ||
| ROIC | 12.02% | ||
| ROICexc | 12.28% | ||
| ROICexgc | 17.2% | ||
| OM | 11.64% | ||
| PM (TTM) | 8.92% | ||
| GM | 21.63% | ||
| FCFM | 7.69% |
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-Score9
Asset Turnover0.97
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.24 | ||
| Debt/FCF | 2.67 | ||
| Debt/EBITDA | 1.29 | ||
| Cap/Depr | 135.69% | ||
| Cap/Sales | 5.83% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 84.82% | ||
| Profit Quality | 86.17% | ||
| Current Ratio | 0.39 | ||
| Quick Ratio | 0.26 | ||
| Altman-Z | 2.39 |
F-Score9
WACC8.38%
ROIC/WACC1.43
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)8.62%
EPS 3Y8.81%
EPS 5Y24.78%
EPS Q2Q%2.46%
EPS Next Y11.76%
EPS Next 2Y9.62%
EPS Next 3Y9.63%
EPS Next 5Y8.68%
Revenue 1Y (TTM)8.61%
Revenue growth 3Y7.84%
Revenue growth 5Y9.12%
Sales Q2Q%7.34%
Revenue Next Year8.84%
Revenue Next 2Y6.39%
Revenue Next 3Y6.07%
Revenue Next 5Y5.58%
EBIT growth 1Y8.14%
EBIT growth 3Y6.75%
EBIT growth 5Y26.36%
EBIT Next Year48.37%
EBIT Next 3Y18.01%
EBIT Next 5Y12.43%
FCF growth 1Y8.15%
FCF growth 3Y6.34%
FCF growth 5Y35.25%
OCF growth 1Y11.89%
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 19.05 and the Price/Book (PB) ratio is 10.47.
How financially healthy is DARDEN RESTAURANTS INC?
The financial health rating of DARDEN RESTAURANTS INC (DRI) is 4 / 10.