Oppenheimer Reiterates Outperform on Darden Restaurants (DRI)
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Oppenheimer reiterated an Outperform rating and $70.00 price target on Darden Restaurants (NYSE: DRI) following a market analysis. Management's $3.80-3.90 EPS outlook assumes +1.5-2% cost inflation and +1-2% comps.
Analyst Brian Bittner commented, "Our analysis suggests the market has presented another DRI buying opportunity. We are attracted to the stock's setup as: 1) valuation now sits at a misplaced discount to peers (8x EBITDA), 2) yet SSS drivers for peer outperformance remain healthy against lowered expectations, 3) our work outlines limited EPS risk with levers for a "meet or beat" scenario in '17, and 4) robust free cash-flow, excess cash on balance sheet and low debt leverage support case for well above-average cash returns. Reiterate Outperform rating and $70 price target."
Shares of Darden Restaurants closed at $62.33 yesterday.
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