Darden Seen Maintaining Outlook Despite Olive Garden Weakness in Fiscal First Quarter, UBS Says

01:21 PM EDT, 09/11/2026 (MT Newswires) -- Darden Restaurants (DRI) is likely to reiterate its full-year outlook after reporting strong fiscal first-quarter results, despite softening trends at its Olive Garden brand, UBS Securities said in a note e-mailed Friday. The restaurant operator could largely reaffirm its fiscal 2027 guidance when it reports results Sept. 24, with underlying trends seen remaining solid, supported by menu innovation and marketing, according to the brokerage. "We expect still-solid (Darden same-store sales) trends and an intact earnings outlook despite select macro pressures," UBS analyst Dennis Geiger said in the note to clients. In June, the company projected full-year earnings from continuing operations at $11.10 to $11.35 a share, sales of $13.60 billion to $13.75 billion and same-restaurant sales growth of 2.5% to 3.5%. The current consensus on FactSet is for non-GAAP EPS of $11.28, sales of $13.69 billion and same-store sales to increase by 3%. For the first quarter, UBS expects Darden to post same-restaurant sales growth of 2.9%, including an increase of 0.5% at Olive Garden and 7.5% at LongHorn Steakhouse. Wall Street is looking for the metric to rise by 3.3% at the company level. Olive Garden faced macro and industry pressures in the quarter, along with "some" headwinds related to the FIFA World Cup and a difficult comparison, Geiger said. "We believe investor sentiment is skewed more negative largely given concerns around pressured (Olive Garden same-store sales) trends." However, the brand is expected to see improvement in the coming quarters and maintain robust underlying multiyear trends, buoyed by factors such as promotions, new menu benefits and continued gains from its partnership with Uber (UBER), according to the note. The brokerage expects price increases in the company's never-ending pasta campaign to support profitability, and sees continued momentum at LongHorn amid consistent execution and menu innovation. "Given a solid growth outlook and the strength in casual dining segment valuations, we believe (Darden) shares remain attractive for a quality compounder with above-(average) top-line resiliency in a tough macro and ability to protect margins and grow earnings despite cost inflation," Geiger said. The company's shares were up 0.8% in Friday afternoon trade, bringing its year-to-gains to nearly 14%. Price: 209.03, Change: +1.50, Percent Change: +0.72