Darden Restaurants Overview
Valuation check: DRI's P/E ratio is 20.62, below the Consumer Staples sector average of 26.52.
Get informed when a big investor buys or sells
+ Follow20.62
The P/E ratio compares a company's stock price to its earnings per share. A lower P/E ratio may indicate that the stock is undervalued.
Darden Restaurants posts a P/E ratio of 20.62. That is below the Consumer Staples sector average of 26.52. Comparing that reading with peers and prior periods is usually more useful than looking at the number in isolation.
For Consumer Staples stocks, a P/E ratio near 26.52 is typical. Darden Restaurants's 20.62 is lower that level. That is roughly 22.2% below the sector mean. Whether that is a warning or an opportunity depends on growth outlook and other fundamentals shown elsewhere on Stockcircle.
Darden Restaurants's P/E ratio of 20.62 comes from dividing a price-based measure by a related financial statistic. Changes can come from the stock price moving, the underlying fundamental shifting, or both. Track both the level and the trend — a rising multiple on falling fundamentals is a different story than a rising multiple on rising earnings.
Context for DRI's P/E ratio usually means three checks: (1) trend versus prior periods, (2) level versus peers (average 26.52), and (3) consistency with growth and profitability. This page covers the first two; Darden Restaurants's other metric pages and overview cover the third.
Judging Darden Restaurants against Consumer Staples peers is usually better than using a market-wide rule of thumb. Business models inside Consumer Staples are more comparable, which makes gaps in P/E ratio easier to interpret. Start with 20.62 here, then scan peer and history charts to see if the gap is persistent.
