Darden Earnings Beat, Dividend Raised, New Buyback
Darden earnings beat as sales rose; board hiked dividend to $1.62 and authorized a $1.5 billion buyback, putting trader focus on capital returns.
KEY TAKEAWAYS
- Board raised quarterly dividend to $1.62 and authorized a $1.5 billion buyback.
- Adjusted Q4 EPS was $3.66, beating consensus; the quarter included a 53rd week that added $0.25 to EPS.
- Olive Garden same-restaurant sales were 2.4% while LongHorn rose 9.5%, complicating growth outlook.
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Darden Restaurants (NYSE: DRI) reported fiscal fourth-quarter results on June 25, 2026, with adjusted EPS exceeding estimates and sales rising. The board raised the quarterly dividend and authorized a new share-repurchase program, even as Olive Garden same-restaurant sales slowed.
Quarter Results and Capital Returns
Darden said in its press release that adjusted fourth-quarter EPS was $3.66, beating a $3.63 consensus, while reported diluted EPS from continuing operations was $3.54. Total sales rose 13.7% year over year to $3.72 billion, with blended same-restaurant sales up 4.6%. The quarter included a 53rd week that added $0.25 to reported and adjusted EPS. For the full fiscal year, total sales reached $13.21 billion, up 9.4%, and adjusted EPS rose 11.4% to $10.64. The company filed an SEC Form 8-K furnishing the release as Exhibit 99.1.
Brand performance varied: Olive Garden’s same-restaurant sales increased 2.4%, LongHorn Steakhouse rose 9.5%, and the fine-dining group grew 1.9%.
The board declared a quarterly cash dividend of $1.62 per share, an 8.0% increase, and authorized a new $1.5 billion share repurchase program. Darden repurchased $138 million in the fourth quarter. President and Chief Executive Officer Rick Cardenas said the quarter was a strong finish to an excellent year in which the company significantly outperformed the industry. The dividend raise and buyback authorization highlight capital returns as a key focus for management.
For fiscal 2027, Darden guided sales of $13.60 billion to $13.75 billion and same-restaurant sales growth of 2.5% to 3.5%. Adjusted diluted EPS from continuing operations is expected between $11.10 and $11.35, with EBITDA projected at $2.26 billion to $2.29 billion. The company anticipates capital expenditures of about $875 million, inflation near 3.0%, an effective tax rate around 13.5%, and roughly 114 million weighted-average diluted shares outstanding.
These results and board actions present a mixed outlook: near-term shareholder returns through dividend and buybacks contrast with brand-level divergence and guidance indicating moderate top-line growth.
