DRI
Darden Restaurants, Inc.
$214.52
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Fair Value
Trading 22.9% below fair value
You pay
$214.52
Bear
$233.02
Fair
$278.33
Bull
$323.64
Bear
$233.02
+8.6%
$10.39 × 22x P/E
Fair
$278.33
+29.7%
$10.39 × 27x P/E
Bull
$323.64
+50.9%
$10.39 × 31x P/E
Adjust Assumptions
26.8x
10.39$
Key Value Driver
Normalized P/E multiple (27x base case)
Implied Market Multiple
20.6x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (60 analysts)
$237.79
Divergence from AlphaVal
17%
Summary
Applying a 27x P/E to adjusted EPS of $10.39, the base-case value is $278.33 per share. DDM cross-check: $367.35.
Warnings
Dividend-based valuation: $367.35 (above our primary estimate by 32%). Large gaps may signal the dividend doesn't reflect full earning power.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples