Darden Restaurants (NYSE:DRI – Get Rating) and First Watch Restaurant Group (NASDAQ:FWRG – Get Rating) are both retail/wholesale companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, dividends, institutional ownership, risk and earnings.
Analyst Ratings
This is a summary of current ratings and recommmendations for Darden Restaurants and First Watch Restaurant Group, as reported by MarketBeat.
Get Darden Restaurants alerts:| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Darden Restaurants | 0 | 5 | 18 | 0 | 2.78 |
| First Watch Restaurant Group | 0 | 2 | 5 | 0 | 2.71 |
Darden Restaurants presently has a consensus target price of $152.04, suggesting a potential upside of 3.49%. First Watch Restaurant Group has a consensus target price of $20.63, suggesting a potential upside of 30.04%. Given First Watch Restaurant Group's higher probable upside, analysts plainly believe First Watch Restaurant Group is more favorable than Darden Restaurants.
Profitability
This table compares Darden Restaurants and First Watch Restaurant Group's net margins, return on equity and return on assets.| Net Margins | Return on Equity | Return on Assets | |
| Darden Restaurants | 9.10% | 42.51% | 9.02% |
| First Watch Restaurant Group | 0.39% | 0.53% | 0.26% |
Institutional & Insider Ownership
89.2% of Darden Restaurants shares are owned by institutional investors. Comparatively, 96.4% of First Watch Restaurant Group shares are owned by institutional investors. 0.9% of Darden Restaurants shares are owned by insiders. Comparatively, 4.1% of First Watch Restaurant Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares Darden Restaurants and First Watch Restaurant Group's gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Darden Restaurants | $9.63 billion | 1.86 | $952.80 million | $7.25 | 20.26 |
| First Watch Restaurant Group | $601.19 million | 1.56 | -$2.11 million | $0.05 | 317.26 |
Darden Restaurants has higher revenue and earnings than First Watch Restaurant Group. Darden Restaurants is trading at a lower price-to-earnings ratio than First Watch Restaurant Group, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Darden Restaurants has a beta of 1.21, meaning that its stock price is 21% more volatile than the S&P 500. Comparatively, First Watch Restaurant Group has a beta of 0.87, meaning that its stock price is 13% less volatile than the S&P 500.
Summary
Darden Restaurants beats First Watch Restaurant Group on 10 of the 14 factors compared between the two stocks.
About Darden Restaurants
(Get Rating)
Darden Restaurants, Inc. is a full-service restaurant company, which engages in the provision of restaurant services. It operates through the following segments: Olive Garden, LongHorn Steakhouse, Fine Dining, and Other Business. The Olive Garden segment is the largest full-service dining Italian restaurant operator. The LongHorn Steakhouse segment includes the results of the company-owned LongHorn Steakhouse restaurants. The Fine Dining segment consists of the premium brands that operate within the fine-dining sub-segment of full-service dining and includes the results of its company-owned The Capital Grille and Eddie V's restaurants. The Other Business segment aggregates the remaining brands and includes the results of its company-owned Cheddar's Scratch Kitchen, Yard House, Seasons 52 and Bahama Breeze restaurants, and from franchises and consumer-packaged goods sales. The company was founded by William B. Darden in 1938 and is headquartered in Orlando, FL.
About First Watch Restaurant Group
(Get Rating)
First Watch Restaurant Group, Inc. operates and franchises restaurants under the First Watch trade name. As of September 7, 2022, it operated 445 restaurants in 28 states in the United States. The company was formerly known as AI Fresh Super Holdco, Inc. and changed its name to First Watch Restaurant Group, Inc. in December 2019. First Watch Restaurant Group, Inc. was founded in 1983 and is headquartered in Bradenton, Florida.
Receive News & Ratings for Darden Restaurants Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Darden Restaurants and related companies with MarketBeat.com's FREE daily email newsletter.