Mizuho Upgrades Darden Stock on Strong Sales Outlook

Mizuho Raises Darden's Stock Rating and Price Target

Financial services firm Mizuho has upgraded Darden Restaurants stock to Outperform from a previous Neutral rating. The firm also increased its price target for the company's shares significantly to $235, up from $195.

Stronger Sales Fuel Analyst Confidence

The upgrade is driven by expectations of stronger same-store sales and improving profit margins. Mizuho analysts view Darden as a prime beneficiary of anticipated category tailwinds in casual dining for 2026, alongside company-specific growth drivers.

The firm has raised its fiscal third-quarter same-store sales estimate for Olive Garden to 5 percent, exceeding the 4.5 percent market consensus. Additionally, it maintained a 7 percent sales growth estimate for LongHorn Steakhouse, which also stands above consensus expectations.

Impact on Darden Stock and Restaurant Sector

This positive revision from a major financial firm is likely to bolster investor confidence in Darden Restaurants. The new price target suggests considerable potential upside for the stock. The optimistic outlook for the casual dining sector could also have a positive spillover effect on related stocks within the industry.

Conclusion and Future Outlook

Mizuho's analysis signals a favorable period for Darden, underpinned by robust performance forecasts for its flagship brands. Investors will be closely monitoring the company's upcoming earnings releases to validate these sales projections, which will be crucial for the stock's trajectory.

FAQ

Q: Why did Mizuho upgrade Darden Restaurants stock?
A: Mizuho upgraded Darden based on strong same-store sales expectations for its key brands and the prospect of improving margins.

Q: What is the new price target for Darden stock from Mizuho?
A: The new price target has been raised to $235 from the previous target of $195.

Source: Investing.com