Darden Beats Earnings Despite Olive Garden, Fine-Dining Sales Dragging
Darden Restaurants, Inc. (NYSE:DRI) has reported its financial results for the fourth quarter and full year of 2024. The company's net sales increased by 6.8% to $2.96 billion, largely driven by the acquisition of 80 Ruth's Chris Steak House locations and the opening of 37 new restaurants. However, Olive Garden's same-store sales declined for the second consecutive quarter. Darden reported a net income of $308.1 million, or $2.57 per share, a decrease from $315.1 million, or $2.65 per share, the previous year. Excluding acquisition-related costs, the company earned $2.65 per share, surpassing Wall Street estimates.
Darden's Board of Directors declared a quarterly cash dividend of $1.40 per share, a 6.9% increase from the previous quarter. The company also repurchased approximately $97.3 million of its common stock during the quarter, with around $915 million remaining under its $1 billion repurchase authorization. For fiscal 2025, Darden plans to open 45 to 50 new restaurants and expects same-store sales to grow by 1% to 2%. Capital expenditures are projected to be between $550 million and $600 million.
Stock analysts at Wedbush reiterated an “outperform” rating for Darden, with a price objective of $170.00. Morgan Stanley also maintained an 'overweight' rating, though it reduced its target price from $180.00 to $175.00. Despite some mixed signals, including a decrease in Olive Garden's performance, Darden's overall financial outlook remains positive with continued expansion and strategic acquisitions.
