Company Profile
The world’s largest restaurant group
With more than 1,800 restaurants and over 175,000 employees, Darden Restaurants (ticker: DRI) is the world’s largest full-service restaurant company.
The size of Darden Restaurants
Currently the group has:
- Three fine-dining restaurant chains: Ruth’s Chris Steak House, Eddie V’s Prime Seafood and The Capital Grille.
- Seven casual dining chains: Olive Garden Italian Restaurant, LongHorn Steakhouse, Bahama Breeze, Seasons 52, Yard House and Cheddar’s Scratch Kitchen. In July 2024, Darden Restaurants agreed to acquire Chuy’s.
Initial Public Offering
In 1995, General Mills spun off Darden Restaurants and immediately took it public.
History of Darden Dining
Founded of the company
In 1938, William Darden opened his first restaurant, The Green Frog, in Waycross, Georgia, where the Red Lobster franchise was established to great acclaim from diners and critics alike.
Sold to General Mills
By 1970, it had expanded to three branches, with two more under construction. Although these stores were profitable, the company needed more resources to expand. Therefore, Darden sold the company to food giant General Mills (ticker: GIS) that year, and Darden died in 1994.
General Mills, the breakfast cereal maker, upgraded its chain to a more casual dining and family-oriented model, with Red Lobster expanding to nearly 400 locations by 1985.
Kept growing
The group then founded the York Steak House chain of British steak and pork rib restaurants in the 1970s.
The first Olive Garden concept restaurant opened in 1982, and by 1989, there were more than 145 restaurants in operation, making it the fastest growing restaurant in the company’s restaurant group. Sales per restaurant soon caught up with the level of Red Lobster restaurants, eventually becoming the largest Italian-themed full-service restaurant chain in the United States.
Spin-off of Darden Restaurants
In 1995, General Mills decided to divest its restaurant chains to focus on consumer food products. The new company was named Darden Restaurants in honor of Darden, the founder of Red Lobster.
Recession resilent
Olive Garden and LongHorn Steakhouse’s performance fell short of expectations, and Darden Restaurants had poor sales in the fourth quarter of 2024. However, the next day’s stock price soared 5.77%.
The reason was that the CEO said in a conference call about the earnings release: The company’s business was not affected by inflation; because people still choose to go out to restaurants as the main way to comfort themselves, this sense of ritual has not been affected by economic prosperity for a long time, and is not expected to be affected by economic booms in the future.
Capital market performance
Market Cap
As of January 19, 2025, Darden Restaurants’ market value was US$23.31 billion.
Price-to-Earnings Ratio
As of March 20, 2025, Darden Restaurants’ P/E ratio is 22.46 times.
Dividend yield
As of March 20, 2025, Darden Restaurants’ cash dividend yield was 2.81%, which is considered a relatively high level among US stocks.
Stock price performance
As of March 20, 2025, Darden Restaurants stock:
- It has risen 21.91% in the past year.
- Since the company went public, its stock price has risen by 3,074%.
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