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. 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
DRI had positive earnings in the past year.
DRI had a positive operating cash flow in the past year.
DRI had positive earnings in each of the past 5 years.
In the past 5 years DRI always reported a positive cash flow from operatings.
1.2 Ratios
DRI has a Return On Assets of 8.62%. This is amongst the best in the industry. DRI outperforms 80.30% of its industry peers.
DRI's Return On Equity of 49.43% is amongst the best of the industry. DRI outperforms 90.15% 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.
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 Profit Margin of 8.90%. This is in the better half of the industry: DRI outperforms 70.45% of its industry peers.
In the last couple of years the Profit Margin of DRI has declined.
DRI has a better Operating Margin (11.63%) 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 85.61% 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
DRI has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, DRI has less shares outstanding
The number of shares outstanding for DRI has been reduced compared to 5 years ago.
DRI has a worse debt/assets ratio than last year.
2.2 Solvency
DRI has an Altman-Z score of 2.32. 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.
DRI has a Altman-Z score of 2.32. This is in the better half of the industry: DRI outperforms 65.91% of its industry peers.
The Debt to FCF ratio of DRI is 3.68, which is a good value as it means it would take DRI, 3.68 years of fcf income to pay off all of its debts.
DRI has a better Debt to FCF ratio (3.68) 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.
With a Debt to Equity ratio value of 1.76, DRI perfoms like the industry average, outperforming 53.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.76 | ||
| Debt/FCF | 3.68 | ||
| Altman-Z | 2.32 |
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.
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 has a worse Quick ratio (0.27) than 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.
Looking at the last year, DRI shows a quite strong growth in Revenue. The Revenue has grown by 8.30% in the last year.
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
Based on estimates for the next years, DRI will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.68% on average per year.
The Revenue is expected to grow by 5.58% on average over the next years.
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.
When comparing the Price/Earnings ratio of DRI to the average of the S&P500 Index (25.07), we can say DRI is valued slightly cheaper.
A Price/Forward Earnings ratio of 14.70 indicates a correct valuation of DRI.
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.
DRI is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.3 | ||
| Fwd PE | 14.7 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as DRI.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of DRI indicates a somewhat cheap valuation: DRI is cheaper than 73.48% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.43 | ||
| EV/EBITDA | 11.86 |
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)1.42
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.
Compared to an average industry Dividend Yield of 4.59, DRI pays a better dividend. On top of this DRI pays more dividend than 86.36% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, DRI pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.31% |
5.2 History
On average, the dividend of DRI grows each year by 16.99%, which is quite nice.
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.
DRI's earnings are growing slower than its dividend. 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.