This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Darden Falls on Food Inflation Forecast

ORLANDO ( TheStreet) -- Darden Restaurants (DRI - Get Report) beat fiscal third-quarter profit expectations but said that in still needs to offer promotions to draw in diners.

Darden, the operator of Red Lobster, Olive Garden and Longhorn Steakhouse restaurants, also reiterated its outlook for food cost inflation between 3.5% to 4% in fiscal 2012.

The company also warned that the U.S. restaurant industry remains under pressure as the economy works to recover, meaning diners remain reluctant to go out and spend money at restaurants without promotions and deals to entice them.

Those cautionary statements led investors to bid Darden shares 2.6% lower to $46.78 Friday morning despite its earnings beat.

Fewer-than-expected diners visited Olive Garden restaurants open at least 14 months last quarter as some of its promotions did not have the strong pull on diners Darden had hoped for. Olive Garden sales account for nearly half of the company's net revenue.

"The environment, while improving, remains more fragile than normal and it's very much driven by promotional effectiveness," CFO Brad Richmond told analysts on a conference call.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
EAT $54.24 0.00%
DRI $69.05 0.00%
RRGB $81.10 0.00%
AAPL $113.29 0.00%
FB $91.01 0.00%

Markets

Chart of I:DJI
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 +1.21 0.06%
NASDAQ 4,828.3250 +15.6170 0.32%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs