Restaurant group owner Darden Restaurants Inc (NYSE:DRI) saw its shares tucked into in early New York deals after it received an upgrade from broker RBC, which said it now saw a buying opportunity.
The stock ticked up 0.49% to US$85.66 as RBC lifted its rating on the share to 'outperform' from 'sector perform'.
The operator of Olive Garden and other casual-dining chains recently served up a mixed bag of earning results for its third quarter.
It booked a net income of US$1.71 per share on sales of US$2.13bn.
That beat consensus estimates for EPS (earnings per share) of US$1.64 in the quarter but fell just short of analysts’ expectations for US$2.15bn in revenue.
Same-store sales also came in lighter than expected, rising 2% at company-owned locations versus a 2.5% forecast.
After the results, shares suffered a major pull back and ended the first quarter 11.2% lower. RBC reckons this marks a significant buy-in opportunity for investors.
RBC also lifted its price target to US$97 from US$93.
Notably, in the past, Darden has outperformed in the second quarter, gaining 13.5% on average during the period over the past 10 years.
Also, the firm has only closed the second quarter in negative territory once in the last decade.
Later shares were 1.37% lower at US$84.07.