Why Darden Restaurants Stock Jumped As Much As 25.6% Today
Shares of Darden Restaurants (NYSE: DRI) rose as much as 25.6% in Wednesday's trading session, boosted by a bullish analyst report. The parent company of restaurant chains such as Olive Garden, LongHorn Steakhouse, and Cheddar's Scratch Kitchen closed the day at a milder 8.2% gain.
Analyst firm Gordon Haskett upgraded Darden from a "hold" to a "buy." Analyst Jeff Farmer argued that the 55% sell-off in recent weeks is "overdone" in the light of Darden's solid balance sheet and the potential for a strong rebound in same-store sales after the coronavirus crisis.
Farmer was also an active participant in Darden's third-quarter earnings call two weeks ago. There, he sought greater clarity on the financial impact of a full shutdown in case the COVID-19 pandemic ever goes that far. Management explained that the company would burn roughly $45 million of free cash per week under that scenario.
Source Fool.com
