Darden Restaurants enters the final stretch before its June 18 Q4 earnings with the short rebuild that began in mid-April still intact — and the stock's 5% weekly gain doing little to shake the bears loose.
The short position has continued to edge higher. SI % of free float now reads 5.4%, essentially unchanged from the level flagged earlier this week but up 25% from the 4.3% recorded on April 17. The daily trend remains one-directional: no reversals, no covering spikes, just a slow and deliberate accumulation that has persisted through the stock's recent rally. What's changed since the last note is the pace — the one-month increase of nearly 25% now sits alongside a one-week gain of just over 1%, suggesting the more aggressive leg of the rebuild may be behind us and shorts are now holding rather than pressing. The borrow market remains entirely permissive. Cost to borrow has ticked up to 0.49% — about 15% higher on the week — but that is still firmly in the "noise" range for a stock of this size. Availability is wide at roughly 776% of short interest, down from above 840% a week ago but well within normal territory. There is no squeeze pressure here.
Options positioning has eased slightly from its recent peak but stays defensive. The put/call ratio is at 1.21, just above its 20-day average of 1.14 and a z-score of only 0.33 — a modest lean toward puts rather than the sharper defensive posture seen two weeks ago when the PCR hit 1.41. The 52-week high on the PCR is 1.58, so current levels are elevated relative to the April lows (which ran below 0.80) but nowhere near extreme. The combination — shorts holding positions while options hedging moderates — reads as a market that has priced in some caution but is not in full defensive mode ahead of the print.
The Street remains broadly constructive. Keybanc raised its target to $228 today, maintaining its Overweight rating — a marginal nudge but notable for its timing one day before the week closes. The broader analyst cluster still sits well above current levels, with a mean target near $225 against a close of $203.83, implying roughly 10% upside from here. Most of the post-March earnings target revisions were upward across the board — Citigroup, Deutsche Bank, Barclays, and Evercore all lifted numbers while keeping positive ratings. Wells Fargo and Baird held neutral-equivalent stances with targets in the $210–$215 range. The bull case centres on scale advantages at Olive Garden and LongHorn, plus unit growth discipline. Bears point to beef cost pressure and marketing spend squeezing restaurant-level margins — concerns that will be front and centre in the June 18 release. On valuation, the P/E is running at 18.7x and EV/EBITDA at 14.0x, both drifting modestly higher over the past month alongside the stock price.
Among peers, CAKE jumped 5.7% on the day and 8.3% on the week, while CBRL gained 13.6% over the same period — both outpacing DRI's weekly 5.2%. CMG, by contrast, fell 4.3% on the week, suggesting the strength in casual dining is not uniformly distributed. DRI's relative performance sits in the middle of the peer group — a picture more consistent with rotation into cheaper casual names than with any DRI-specific catalyst.
The June 18 print is now three weeks out. The short interest trend, the options lean, and the analyst cluster on beef costs all point to the same focal question: whether margin guidance for FY27 can absorb commodity headwinds without a downside revision.
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