Management’s guidance

After Darden Restaurants’ (DRI) strong results for the third quarter of fiscal 2019, its management has raised its SSSG (same-store sales growth), revenue growth, and EPS guidances for fiscal 2019.

The company’s management expects its revenue to rise 5.5%, with its overall SSSG for the year likely to be in the range of 2.5%–2.7%. Management has also raised its EPS guidance to the range of $5.76–$5.80 from its earlier guidance of $5.60–$5.70.

Darden’s Management Raises Its Guidance for Fiscal 2019

Analysts’ estimates for fiscal 2019

For fiscal 2019, analysts expect Darden to post revenue of $8.55 billion, which represents a rise of 5.9% from $8.08 billion in fiscal 2018. Net new restaurant additions and positive SSSG are expected to drive the company’s revenue in fiscal 2019. Darden continues to focus on the guest experience, off-premises sales, flawless execution, menu simplification, and various marketing and promotional initiatives to drive its SSSG.

Analysts expect Darden to post adjusted EPS of $5.75 in fiscal 2019, a rise of 19.6% from $4.81 in fiscal 2018. Revenue growth, EBIT margin improvements, a lower effective tax rate, and share repurchases are expected to drive the company’s EPS in fiscal 2019.

During the comparable period, Darden’s peers Texas Roadhouse (TXRH), Bloomin’ Brands (BLMN), and Brinker International (EAT) are expected to post EPS growth of 6.7%, -1.4%, and 8.8%, respectively.

Analysts’ estimates for fiscal 2020

Analysts expect Darden’s revenue to rise 6.9% to $9.14 billion in fiscal 2020, while they expect its EPS to rise 11.7%. Darden’s management expects to open 50 new restaurants in the United States in fiscal 2020.

Next, we’ll look at analysts’ recommendations for Darden stock.

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