Darden Serves Up A Win — LongHorn Steakhouse Is The Star Dish

Darden Restaurants, Inc. (NYSE:DRI) shares traded higher on Thursday after the company posted an earnings beat and continued to show steady demand across its brands. The results offered investors some reassurance, even as analysts said questions still linger over margins, costs, and consumer spending trends. Quarterly Metrics The company reported third-quarter adjusted earnings per share of 2.95, beating the analyst consensus estimate of $2.94. Quarterly sales of $3.345 billion (+5.9% year over year) outpaced the Street view of $3.333 billion. Growth in revenues was driven by a blended same-restaurant sales increase of 4.2% and sales from 31 net new restaurants. Darden’s consolidated same-restaurant sales growth was led by a 7.2% increase at LongHorn Steakhouse. Olive Garden posted 3.2% growth, while Fine Dining and Other Business delivered gains of 2.1% and 3.9%, respectively. “Across all our brands, we’re seeing historically high team member and manager retention, which is enabling consistent execution and strong guest satisfaction,” said Darden President & CEO Rick Cardenas. Dividend Darden declared a quarterly cash dividend of $1.50 per share on the company’s outstanding common stock. The dividend is payable on May 1. As of the end of the third quarter of 2026, the company had $516 million remaining under the current $1 billion repurchase authorization. Outlook Darden narrowed its fiscal 2026 adjusted EPS guidance to $10.57 to $10.67, compared with its prior range of $10.50 to $10.70 (Street view: $10.57). The company also expects fiscal 2026 sales of $13.224 billion, ahead of the $13.164 billion consensus estimate. Darden is looking for 2026 GAAP EPS of $10.40-$10.50, versus the $10.74 analyst estimate. Analyst View Goldman Sachs analyst Christine Cho reiterated a Buy rating on the stock, with a price forecast of $235. Cho said restaurant margins, including marketing, slightly missed Goldman Sachs estimates but were broadly in line with her view. She noted food and beverage costs matched expectations, while labor costs came in slightly above Goldman Sachs estimates. Cho said questions remain about storm-related disruptions and bad weather during the quarter. She also flagged uncertainty around lessons from Olive Garden’s rollout of smaller portion options chainwide. Cho said Darden is still assessing ongoing beef-cost pressures and their effect on margins. She added that investors need more clarity on converting 14 Bahama Breeze locations, including timing and brand choices. Cho also cited uncertainty around whether stimulus and larger tax refunds can offset higher fuel prices and macro volatility. DRI Price Action: Darden Restaurants shares were up 1.07% at $202.85 at the time of publication on Thursday, according to Benzinga Pro data. Photo via Shutterstock