Darden Restaurants: Moderate Valuation, Above Average Yield

By Dividend Monk:

Darden Restaurants owns several brands of restaurant chains including Olive Garden and Red Lobster.

  • Seven Year Revenue Growth Rate: 6.1%
  • Seven Year EPS Growth Rate: 10.4%
  • Latest Dividend Increase: 16.2%
  • Current Dividend Yield: 3.81%
  • Balance Sheet Strength: Leveraged, Stable

The company offers a substantial dividend yield and specific five-year plans for growth, which should be appealing to investors. The current price in the low $ 50′s is fair for the long term, assuming that the company is able to meet the low end of its 2017 goals.

Overview

Darden Restaurants Inc. (NYSE: DRI) operates Olive Garden, Red Lobster, Longhorn Steakhouse, and other restaurant chains throughout the United States. The company generated nearly $ 8 billion in sales during fiscal year 2012 and currently has a market cap of a bit under $ 7 billion. Darden was once part of General Mills but was spun off in the mid-1990′s as its own company.

Olive


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