DRI

Interested in Canadian Imperial Bank of Commerce? Here are five stocks we like better. CIBC delivered strong third-quarter growth: Adjusted EPS rose 26% to C$2.73, adjusted net income reached C$2.6 billion, and revenue increased 15% to C$8 billion. The bank marked its 12th consecutive quarter of positive operating leverage. Performance was broad-based across Canadian and U.S. banking, wealth management and capital markets, while adjusted return on equity improved to 16.8%. Net interest income and margins also expanded, although U.S. margins declined sequentially due to loan and deposit mix and pricing pressure. Management remains cautious on credit and the macro outlook: Impaired loan provisions rose amid trade tensions, geopolitical risks and other shocks, but CIBC said portfolio conditions remain resilient and expects impaired-loss rates to stay near current levels through fiscal year-end. Darden Restaurants Just Hit a 52-Week High–Is the Olive Garden Comeback Story Legit? Canadian Imperial Bank of Commerce (NYSE:CM) reported higher third-quarter earnings and revenue, citing broad-based growth across its businesses, improved margins and continued positive operating leverage, while management said it remains cautious about trade, geopolitical and macroeconomic uncertainty. For the third quarter of fiscal 2026, CIBC reported adjusted earnings per share of C$2.73, up 26% from a year earlier. Reported earnings per share were C$2.47 and included a C$232 million after-tax charge related to the bank's Caribbean operations. Adjusted net income rose to C$2.6 billion, while pre-provision, pre-tax earnings increased 20% to C$4 billion. → Quantum Computing Is Raising the Stakes for Cybersecurity: 5 Stocks to Watch Chipotle Mexican Grill Stock Rallies as Q2 Results Top Fears, Guidance Rises Revenue rose 15% year over year to C$8 billion. Expenses increased 11%, driven by revenue-linked compensation, business activity and investments in technology, people, branding and strategic initiatives. The result marked CIBC's 12th consecutive quarter of positive operating leverage, according to President and Chief Executive Officer Harry Culham. “The connectivity of our platform and deep client relationships are translating into high-quality earnings and broad-based growth,” Culham said during the bank's quarterly conference call. → NVIDIA Reveals $21 Billion SpaceX Stake: Signal of Confidence or Circular Financing? Investors Are Buying Into Sweetgreen Again—Should They? CIBC ended the quarter with a common equity tier 1, or CET1, capital ratio of 13.4%, down 19 basis points sequentially. Chief Financial Officer Rob Sedran said organic capital generation was offset by the Caribbean-related charge, the closing of a minority investment in & Partners, and share repurchases. The bank repurchased 7.5 million shares during the quarter. The bank's liquidity coverage ratio averaged 127% in the quarter. Adjusted return on equity was 16.8%, up 260 basis points from the year-earlier period. → Berkshire Boosts Its Bet: This AI Hyperscaler Is Now a Top-3 Holding Excluding trading, net interest income increased 14%, supported by balance-sheet growth and margin expansion. CIBC's all-bank net interest margin excluding trading rose 13 basis points from a year earlier and 2 basis points sequentially. Sedran reiterated management's expectation for a stable to gradually positive bias in net interest margin over time. In Canadian personal and business banking, net interest margin was 3.04%, up 3 basis points sequentially. In the U.S. segment, margin was 3.76%, down 14 basis points from the prior quarter as loans grew faster than deposits and product margins declined. Sedran and U.S. Region head Kevin Li said roughly half of the U.S. margin decline was related to loan and deposit mix, with the remainder tied to pricing. Li said some pricing pressure reflected loans being repriced lower as clients improved their credit profiles. He added that CIBC expects a seasonal reversion in U.S. deposits in coming quarters. Canadian Personal and Business Banking posted adjusted net income growth of 17% and revenue growth of 9%. Revenue benefited from a 25-basis-point year-over-year margin expansion and loan growth. Expenses rose 8%, primarily due to technology investments, strategic initiatives and employee-related costs. Hratch Panossian, CIBC's group head of Canadian personal and business banking, said the bank is prioritizing profitable client relationships and market-share gains in everyday banking, credit cards and mass-affluent clients. He said demand deposits grew in the mid-single digits, while guaranteed investment certificate balances fell about 10% year over year as some clients shifted into managed investment products. Canadian Commercial Banking and Wealth Management revenue increased 18%. Commercial banking revenue rose 11% on higher margins and volume growth, with commercial loans and deposits increasing 7% and 8%, respectively. Wealth management revenue climbed 23%, driven by higher average fee-based assets and client activity. Assets under administration and assets under management both increased more than 20% from a year ago. U.S. Commercial Banking and Wealth Management net income rose 22%, supported by a 7% increase in revenue and lower loan-loss provisions. Capital Markets net income increased 34% as revenue rose 22%, helped by strong equity trading and financing activity. Corporate and transaction banking revenue also increased, though lower advisory and equity underwriting activity partly offset those gains. Christian Exshaw, CIBC's head of Capital Markets, said the business had benefited from three quarters of “exceptional constructive markets.” He said CIBC expects year-over-year growth in the fourth quarter, though with some quarter-over-quarter moderation due to macroeconomic uncertainty. Total provision for credit losses was C$564 million in the third quarter, down from C$605 million in the prior quarter. Provisions on impaired loans were C$612 million, up C$64 million sequentially, primarily due to higher provisions in Canadian commercial banking and capital markets. Chief Risk Officer Frank Guse said elevated impaired losses reflected a small number of specific events in the Canadian commercial banking and capital markets portfolios rather than a broader deterioration in credit conditions. The bank's gross impaired loan ratio was 65 basis points, down 1 basis point from the prior quarter. CIBC's allowance coverage rose to 81 basis points from 80 basis points in the prior quarter. Guse said the bank continued building reserves in Canadian consumer and commercial banking for tariff-related and macroeconomic risks, while releases in U.S. and capital-markets allowances were primarily related to a U.S. commercial real estate loan portfolio sale and portfolio migrations. Guse said impaired losses were running somewhat above the bank's initial expectations for the year, reflecting factors including trade tensions, Middle East conflict and oil-price shocks. However, he said management remains comfortable with portfolio resilience and expects impaired-loss rates to remain around current levels through the rest of the fiscal year. Culham said CIBC will hold its next Investor Day on Dec. 9, when it plans to provide additional detail on its strategy, business mix and priorities for long-term growth. Canadian Imperial Bank of Commerce (NYSE: CM), commonly known as CIBC, is a major Canadian financial institution headquartered in Toronto. Formed in 1961 through the merger of the Canadian Bank of Commerce and the Imperial Bank of Canada, CIBC is one of Canada's largest banks and provides a broad range of banking and financial services to retail, small business, commercial and institutional clients. CIBC's activities span personal and business banking, wealth management, capital markets and corporate banking. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Canadian Imperial Bank of Commerce Q3 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Darden (NYSE:DRI) and the rest of the sit-down dining stocks fared in Q2. Sit-down restaurants offer a complete dining experience with table service. These establishments span various cuisines and are renowned for their warm hospitality and welcoming ambiance, making them perfect for family gatherings, special occasions, or simply unwinding. Their extensive menus range from appetizers to indulgent desserts and wines and cocktails. This space is extremely fragmented and competition includes everything from publicly-traded companies owning multiple chains to single-location mom-and-pop restaurants. The 9 sit-down dining stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 1.1%. In light of this news, share prices of the companies have held steady as they are up 2.4% on average since the latest earnings results. Founded in 1968 as Red Lobster, Darden (NYSE:DRI) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands. Darden reported revenues of $3.72 billion, up 13.7% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a narrow beat of analysts’ same-store sales estimates but full-year revenue guidance meeting analysts’ expectations. "The fourth quarter was a strong finish to an excellent year, one in which we significantly outperformed the industry," said Darden President & CEO Rick Cardenas. Interestingly, the stock is up 3.2% since reporting and currently trades at $217.58. Is now the time to buy Darden? Access our full analysis of the earnings results here, it’s free. Celebrated for its delicious (and free) brown bread, gigantic portions, and delectable desserts, Cheesecake Factory (NASDAQ:CAKE) is an iconic American restaurant chain that also owns and operates a portfolio of separate restaurant brands. The Cheesecake Factory reported revenues of $1.03 billion, up 7.7% year on year, outperforming analysts’ expectations by 2.9%. The business had a stunning quarter with an impressive beat of analysts’ same-store sales estimates and a beat of analysts’ EPS estimates. The market seems happy with the results as the stock is up 20.7% since reporting. It currently trades at $107.43. Is now the time to buy The Cheesecake Factory? Access our full analysis of the earnings results here, it’s free. Operating a franchise model, Dine Brands (NYSE:DIN) is a casual restaurant chain that owns the Applebee’s and IHOP banners. Dine Brands reported revenues of $240.9 million, up 4.4% year on year, exceeding analysts’ expectations by 1.7%. Still, it was a mixed quarter as it posted a miss of analysts’ EBITDA estimates. As expected, the stock is down 1.4% since the results and currently trades at $34.37. Read our full analysis of Dine Brands’s results here. Founded in 1978 in California, BJ’s Restaurants (NASDAQ:BJRI) is a chain of restaurants whose menu features classic American dishes, often with a twist. BJ's reported revenues of $388.9 million, up 6.4% year on year. This print surpassed analysts’ expectations by 3.2%. It was a very strong quarter as it also produced a solid beat of analysts’ same-store sales estimates and full-year EBITDA guidance slightly topping analysts’ expectations. BJ's pulled off the biggest analyst estimate beat among its peers. The stock is down 13.7% since reporting and currently trades at $64.08. Read our full, actionable report on BJ's here, it’s free. Owner of the iconic Australian-themed Outback Steakhouse, Bloomin’ Brands (NASDAQ:BLMN) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands. Bloomin' Brands reported revenues of $1.02 billion, up 1.3% year on year. This number beat analysts’ expectations by 1.3%. Overall, it was a strong quarter as it also recorded full-year EPS guidance exceeding analysts’ expectations and a beat of analysts’ EPS estimates. Bloomin' Brands had the slowest revenue growth in the group. The stock is up 17.3% since reporting and currently trades at $10.47. Read our full, actionable report on Bloomin' Brands here, it’s free. Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership. Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products. By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals. Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

Brinker International, Inc. EAT expects another year of revenue and earnings growth in fiscal 2027, helped by an unusual 53rd operating week. The calendar benefit is meaningful, but it is only one part of the outlook.Investors still have to weigh Chili's traffic assumptions, restaurant reinvestment and cost pressures to judge how much of the projected growth reflects underlying operating progress. Brinker expects fiscal 2027 revenues of $6.15-$6.27 billion and adjusted earnings of $12.60-$13.40 per share. Management built the outlook around mid-single-digit Chili's same-store sales growth and positive traffic for the remainder of the year. Brinker International, Inc. price-consensus-chart | Brinker International, Inc. Quote That keeps Chili's execution at the center of the forecast. Darden Restaurants, Inc. DRI, with brands including Olive Garden and LongHorn Steakhouse, provides another large full-service dining benchmark. Texas Roadhouse, Inc. TXRH operates predominantly in casual dining, making traffic and restaurant-level execution important points of comparison across the category. The extra operating week is expected to add about 2% to fiscal 2027 revenues and 70 cents to adjusted earnings per share. Because that contribution comes from the calendar, it should be separated from the company's underlying sales and margin progress.The distinction matters when comparing fiscal 2027 with fiscal 2026. Growth supported by a 53rd week is real for the reported year, but Chili's comparable sales, traffic and restaurant economics will provide a cleaner read on operating momentum. Brinker completed 11 Chili's reimages in fiscal 2026 and plans another 60-80 in fiscal 2027. The program expands a growth lever that is separate from near-term comparable-sales gains and is intended to refresh more of the restaurant base.Fiscal 2027 guidance also assumes three net new company-owned restaurant openings. Brinker plans to acquire 12 franchised Chili's restaurants in Alabama and Mississippi, while management expects a larger new-unit development ramp beginning in later fiscal years. Commodity inflation is expected to ease through fiscal 2027, from about 4% in the first quarter to 3% in the second, 2% in the third and 1% in the fourth. Beef remains the main commodity pressure after contributing to higher food costs in the most recent quarter.Brinker also plans to keep pricing near the lower end of its 3-5% range to protect Chili's value proposition. That approach supports traffic goals but reduces the pricing cushion available if commodity or other restaurant costs prove more persistent. Maggiano's recovery remains slower than planned. Management has incorporated that slower turnaround into fiscal 2027 guidance and modeled roughly flat revenues and profits for the brand.The brand's smaller contribution limits its effect on consolidated results, but execution still matters. Fiscal 2026 comparable sales fell 3.9%, traffic declined 9.3% and restaurant operating margin dropped to 10.1% from 16.3%, leaving little room for further deterioration. The bottom line is that the 53rd week gives fiscal 2027 a clear earnings and revenue lift, while Chili's traffic, reimages and unit actions provide the more durable operating tests. Inflation, pricing discipline and Maggiano's weakness remain offsets.EAT currently carries a Zacks Rank #3 (Hold), along with a Growth Score of A, Momentum Score of A and VGM Score of A. Its Value Score is C. The Style Scores point to favorable growth and momentum characteristics, but they are designed to complement the Zacks Rank. With a #3 Rank rather than a #1 or #2, the combination supports a measured stance instead of an unqualified buy signal. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Brinker International, Inc. (EAT) : Free Stock Analysis Report Darden Restaurants, Inc. (DRI) : Free Stock Analysis Report Texas Roadhouse, Inc. (TXRH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Yum China Holdings YUMC gave investors a clean read on its second-quarter 2026 growth engine. Revenues rose 13% year over year, adjusted earnings per share increased 21% and operating profit rose 14% to $348 million.The question now is whether transaction gains, rapid unit development and brand innovation can keep momentum intact while value pricing, smaller tickets and rising delivery costs pressure store-level economics. KFC and Pizza Hut both contributed to the quarterly beat. KFC system sales increased 7%, while Pizza Hut system sales rose 6%, with both brands generating 1% same-store sales growth. Yum China price-consensus-chart | Yum China Quote KFC remains the company’s main earnings engine, with second-quarter revenues of $2.34 billion and operating profit of $332 million. Pizza Hut is building a broader mass-market platform through value offerings, new formats and product extensions that widened traffic appeal. Yum China recorded its 14th consecutive quarter of same-store transaction growth, a useful signal in a market where consumers remain price-sensitive. Companywide same-store transactions rose 5%, helping offset lower average tickets.At KFC, same-store transactions increased 4% while average ticket declined 3%. Pizza Hut showed a more pronounced trade-off, with transactions up 13% and ticket down 11%, showing how traffic gains compensated for smaller average orders. Unit growth remains central to the investment case. Yum China opened 560 net new stores in the second quarter and 1,196 in the first half of 2026, lifting its total footprint to 19,297 locations as of June 30.Flexible formats, lower average capital requirements and broader franchise participation are supporting expansion. Franchisees accounted for 41% of second-quarter openings, and management remains on track to exceed 20,000 stores in 2026 while targeting more than 30,000 by 2030. Yum China is also using side-by-side concepts to stretch existing brands into more dayparts and occasions. KCOFFEE Cafe has reached more than 3,300 locations and generated a mid-single-digit sales uplift at parent KFC stores.KPRO exceeded 450 locations and delivered an approximately 20% uplift, supporting demand for lighter meals and new consumption occasions. Pizza Hut Burger Bar, now in more than 200 locations, is designed to capture burger and solo-dining demand while adding incremental sales to parent restaurants. Delivery sales increased 26% in the quarter and represented about 54% of company sales, up from 45% a year earlier. That mix brings convenience and reach, but rider expenses reduced restaurant margin by about 140 basis points.Yum China offset most of that pressure through streamlined operations, labor productivity and lower occupancy expenses. Operating margin expanded 20 basis points to 11.1%, marking the ninth straight quarter of expansion, while restaurant margin held flat at 16.1%. The bottom line is that Yum China’s second-quarter results showed traffic-led growth, disciplined expansion and brand extensions working at the same time. The long-term thesis still depends on whether traffic can keep offsetting ticket compression and whether delivery economics can remain manageable.YUMC currently carries a Zacks Rank #2 (Buy). The stock also has a VGM Score of A, along with a Value Score of B, Growth Score of B and Momentum Score of B, a combination that points to favorable traits across valuation, earnings growth and price trend measures. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Restaurant investors can also compare Yum China with Yum! Brands YUM, the global operator of KFC, Pizza Hut, Taco Bell and Habit Burger & Grill, and Darden Restaurants DRI, a full-service dining operator with brands such as Olive Garden and LongHorn Steakhouse. YUMC’s case is more directly tied to China traffic recovery, store density and delivery execution, making those operating metrics critical to watch after the earnings beat. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Yum China (YUMC) : Free Stock Analysis Report Yum! Brands, Inc. (YUM) : Free Stock Analysis Report Darden Restaurants, Inc. (DRI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Yum China Holdings YUMC offers investors a mixed but potentially attractive setup after its second-quarter 2026 earnings beat, better profitability and continued store expansion.The question is whether earnings momentum and a lower valuation are enough to offset limited upside to the six-to-12-month $49 price target, delivery-cost pressure and risks tied to consumer demand in China. YUMC traded at 14.55X forward 12-month earnings, below the restaurant sub-industry at 22.96X, the broader Zacks Retail-Wholesale sector at 22.52X and the S&P 500 at 20.1X. Yum China price-consensus-chart | Yum China Quote That discount is notable against the stock’s own history. The current multiple sits below its five-year median of 19.35X but above the five-year low of 12.52X, suggesting the valuation is cheaper than normal without being deeply distressed. Adjusted earnings per share were 70 cents, up 21% year over year and above the Zacks Consensus Estimate of 69 cents. Revenues rose 13% to $3.14 billion and topped the consensus mark of $3.06 billion.Operating profit increased 14% to a second-quarter record of $348 million. Operating margin widened 20 basis points to 11.1%, marking the ninth consecutive quarter of expansion. Yum China’s investment case also rests on a larger store base. The company plans more than 1,900 net new store openings in 2026 and expects its total count to exceed 20,000 units during the year.Franchisees are expected to account for 40-50% of net new openings at both KFC and Pizza Hut. That mix can bring local capital and resources into lower-tier cities and remote markets, although franchise locations represented only 18% of total stores at the end of the second quarter. Cash generation adds another layer to the investment case. Net cash provided by operating activities reached $976 million in the first half of 2026, up from $864 million in the prior-year period.Yum China plans to return $1.5 billion to shareholders in 2026. It returned $718 million in the first half and intends to distribute 100% of annual free cash flow after minority dividend payments beginning in 2027. The valuation case is not open-ended. The $49 price target implies only modest upside from the $46.47 share price cited as of July 30, 2026.Risks remain visible. KFC’s average ticket fell 3% in the second quarter, while Pizza Hut’s declined 11%. Delivery represented about 54% of company sales, lifting rider-cost pressure, while uneven Chinese consumer spending and intense competition continue to limit pricing power.The planned acquisition of the Pizza Hut brand in Mainland China adds another financial consideration. Yum China expects to fund the deal primarily through a $1.2 billion offshore bridge loan with a term of up to 12 months. YUMC has a constructive near-term profile, but the stock still depends on execution. Earnings growth, margin expansion, lower valuation and capital returns are positives, while the modest price-target gap and delivery economics keep the setup balanced.The stock currently carries a Zacks Rank #2 (Buy). It also has a VGM Score of A, with a Value Score of B, Growth Score of B and Momentum Score of B. That mix points to favorable near-term investment characteristics across valuation, growth and price trends. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Restaurant peers such as Chipotle Mexican Grill CMG and Darden Restaurants DRI offer useful context for investors comparing traffic, pricing and margin execution across the industry. Against that backdrop, Yum China’s longer-term appeal depends on sustaining transactions, protecting margins and keeping earnings estimates supportive. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Yum China (YUMC) : Free Stock Analysis Report Chipotle Mexican Grill, Inc. (CMG) : Free Stock Analysis Report Darden Restaurants, Inc. (DRI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in Domino's Pizza Inc? Here are five stocks we like better. Consumer discretionary stocks remain among the weakest S&P 500 sectors in 2026 despite improving consumer sentiment. Domino's Pizza posted revenue growth, but flat same-store sales and a fifth earnings miss in seven quarters, showing value-focused deals aren't translating into meaningful growth. Higher-end brands like Darden Restaurants, Williams-Sonoma, and Ralph Lauren beat earnings expectations, while Best Buy and Home Depot showed weaker results reflecting cautious middle-income spending. This year, as the market is preoccupied with how the Iran war is propping up the energy sector and how the memory chip shortage has been driving the AI rally, there has been little focus on consumer discretionary stocks' underperformance. In 2026, consumer discretionary remains among the weakest S&P 500 sectors. The Consumer Discretionary Select Sector SPDR Fund, a commonly used proxy for the sector, is down nearly 4% year-to-date. → Buyback Boom: These 3 Companies Are Betting Billions on Their Own Stocks But as Q2 earnings season continues, signs are pointing to a rebound in consumer confidence. While that may bode well for the sector broadly, a sampling of consumer discretionary companies shows that if it is sustainable, the results are anything but uniform. After hitting all-time lows earlier this year, the University of Michigan’s Surveys of Consumers showed a minor uptick in July, with the index jumping from 49.5 in June to 54.4. Despite remaining below the critical threshold of 60—the historical level that serves as a recession risk warning—the sentiment reading marked the second straight month of a 10% increase and the highest reading since February. → 3 Photonics Companies Making Quantum Tech Possible However, economists chalk that up to lower prices at the pump over the past few weeks, which have already begun to reverse course as the United States and Iran have resumed fighting. That was reinforced with a lower June Consumer Price Index reading, with the moderated 3.5% year-over-year (YOY) increase attributed to a drop in gas prices. Nonetheless, the reprieve from higher prices—even if momentary—has had a psychological impact on consumers. But thus far, consumer discretionary earnings have been a mixed bag, telling a more complicated story. → AI Data Centers Need Power, and These 2 Industrials Are Cashing In As Domino’s Pizza (NASDAQ: DPZ) recently demonstrated, everyday consumers may still be ordering, but they are barely growing their tabs. Instead, they are showing highly selective behavior. The company reported Q2 earnings on Monday, July 20, announcing a revenue beat alongside YOY revenue growth of 4.3%. But the real takeaway wasn’t revenue growth or even the earnings per share (EPS) miss. Rather, it was same-store sales, which rose just 0.1%. As a result, Domino’s revised its 2026 guidance. While it maintained full-year sales and profit forecasts and still expects U.S. and international comps to rise in the low-single digits, the company trimmed its outlook for U.S. net unit growth to about 175 stores as franchisee profitability and the company’s development pipeline face elevated near-term pressure. The EPS miss was symptomatic of a developing long-term trend. Dating back to Q4 2024, Domino’s has now missed on earnings in five of its last seven quarters, including three of the last four. Importantly, income from operations only grew by 2.6% in Q2, which the company admitted during its earnings call was below expectations. Domino’s has a broad target market, but it ramped up its value-focused campaigns and lower price points—including lengthy Mix & Match and Best Pizza Deal Ever promotions—in 2026, which has successfully attracted a growing share of lower-income consumers. Much of that decision was driven by cautious consumer spending in the latter half of 2025 and into this year, but it has yet to translate to Domino’s income statements. Meanwhile, multi-brand, full-service restaurant conglomerate Darden Restaurants (NYSE: DRI) tells a very different story. The company, which owns and operates a portfolio including Olive Garden, LongHorn Steakhouse, Yard House, Ruth’s Chris Steak House, Cheddar’s, The Capital Grille, and Seasons 52—among others—reported its fiscal Q4 2026 earnings in late June. EPS of $3.66 beat analyst expectations of $3.63, and while revenue of $3.72 billion just missed the forecasted $3.73 billion, it marked a 13.7% YOY increase. With a trailing price-to-earnings (P/E) ratio of 18.76, the company’s earnings are expected to increase 9.84% over the next year. Notably, Darden’s Q4 same-restaurant sales were up 4.6% YOY and 4.5% for the full fiscal year as diners continue to prioritize experiences over convenience. Olive Garden, LongHorn, and Yard House all posted their fifth consecutive year of positive comp sales, with LongHorn delivering 7.2% same-restaurant sales growth for the full fiscal year and 9.5% growth in Q4. Cardenas specifically highlighted how Darden offers full-service dining for a variety-seeking demographic, offering “a collection of brands that gives us reach across multiple dining occasions, guest demographics, price points, geographies, and cuisine types.” In turn, the company doesn’t rely on a single brand or consumer segment. High-end specialty retailer Williams-Sonoma (NYSE: WSM) also showed that higher-income consumers are spending more freely. When it reported fiscal Q1 earnings on May 21, it beat on earnings and revenue while announcing a 4.8% increase in comps and an operating margin of 16.2%. Premium apparel maker Ralph Lauren (NYSE: RL) also beat on earnings and revenue when it reported fiscal Q4 2026 results on May 21, with revenue climbing 16.6% YOY. Takeout pizza may be lagging the performances of high-end consumer goods and full-service restaurants aimed at affluent shoppers, but there are indications that middle-income consumers are also delaying gratification, especially for big-ticket items and home renovations. Best Buy (NYSE: BBY) reported fiscal Q1 2027 revenue growth of just 1.9% YOY while comparable sales increased 2.0% YOY. Another indication that middle- and lower-income consumers aren’t spending more: tepid financials from Home Depot (NYSE: HD). Often regarded as a bellwether of the economy, the home improvement giant reported negative 4.35% YOY EPS growth for fiscal Q1 2016, while sales rose 4.8% and comparable sales increased 0.6%. Taken together, despite minor improvements in consumer sentiment, the inconsistencies in consumer discretionary stocks continues to demonstrate that shoppers continue to navigate uncertainty, and any increases in spending are showing distinct disparities among income groups. The article "Confidence Is Back, But Earnings Show the Consumer Is Being Picky" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Darden Restaurants DRI presents a balanced investment debate after fiscal 2026 results. Earnings grew, revenues increased and the company kept returning cash to shareholders while investing in new restaurants.The counterpoint is clear. Estimate revisions, softer momentum indicators, cost inflation and consumer spending sensitivity keep the buy case from becoming automatic. Darden’s fiscal 2026 adjusted earnings per share rose to $10.64 from $9.55 in fiscal 2025. Fourth-quarter adjusted earnings per share increased 22.8% year over year to $3.66, giving investors a clear earnings growth base to evaluate. Darden Restaurants, Inc. price-consensus-chart | Darden Restaurants, Inc. Quote Sales also moved higher. Total fiscal 2026 sales increased to $13.21 billion from $12.08 billion, supported by same-restaurant sales growth, an extra operating week and contributions from 43 net new restaurants.The strength was not limited to one metric. Blended same-restaurant sales rose 4.5% for fiscal 2026, with Olive Garden up 4% and LongHorn Steakhouse up 7.2%. That mix gives Darden a firmer foundation than a pure cost-cutting earnings story. DRI trades at 17.6X forward 12-month earnings. That sits below the Zacks sub-industry multiple of 22.83X, the sector multiple of 22.59X and the S&P 500’s 20.8X, making valuation a more constructive part of the investment case.The multiple is close to Darden’s five-year median of 17.53X and below the five-year high of 22.86X. That does not make the stock cheap in isolation, but it suggests the valuation reset has reduced the risk of paying peak multiples for steady growth.Chipotle Mexican Grill CMG remains a relevant fast-casual comparison for investors weighing restaurant growth and valuation trade-offs. Restaurant Brands International QSR offers another peer reference, with a franchised restaurant model that differs from Darden’s company-owned full-service portfolio. Capital allocation strengthens Darden’s investment profile. The company returned approximately $1.4 billion to shareholders in fiscal 2026 through dividends and share repurchases while continuing to fund restaurant development.Darden also raised its quarterly dividend 8% to $1.62 per share and authorized a new $1.5 billion share repurchase program. Long-term debt declined to $1.64 billion at fiscal 2026-end from $2.13 billion at the end of fiscal 2025.That balance matters because the company is not choosing between growth and shareholder returns. Fiscal 2027 guidance calls for 75 to 80 new restaurant openings and capital spending of approximately $875 million, keeping expansion active alongside cash returns. The caution case starts with revenue expectations. Fourth-quarter sales of $3.72 billion missed the consensus mark of $3.74 billion, even though sales increased 13.7% year over year.Estimate trends are also not fully supportive. The current fiscal-year earnings estimate showed a negative 1% change over the past four weeks, which limits the case for a more aggressive near-term view.Costs remain another issue. Management expects roughly 3% total inflation in fiscal 2027, with beef inflation highest early in the year. Darden is pricing below inflation to protect its value proposition, a strategy that can support traffic but may constrain margin expansion. The bottom line is that DRI looks fundamentally steady, but not decisively attractive enough to remove the debate. Earnings growth, cash generation, restaurant expansion and a more reasonable valuation support the stock, while sales misses, estimate pressure and inflation risk keep expectations measured.The stock currently carries a Zacks Rank #3 (Hold). That rank lines up with a wait-and-see stance rather than a clear buy signal, especially when near-term estimate revisions have not strengthened. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Darden has a VGM Score of B, supported by a Growth Score of A. Those scores point to favorable growth characteristics within the Zacks Style Scores framework.The Value Score of C and Momentum Score of D keep the overall signal mixed. For investors, that combination suggests DRI has solid earnings support, but stronger estimate trends or better price momentum would make the investment case more convincing. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Darden Restaurants, Inc. (DRI) : Free Stock Analysis Report Chipotle Mexican Grill, Inc. (CMG) : Free Stock Analysis Report Restaurant Brands International Inc. (QSR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Darden Restaurants, Inc. DRI closed fourth-quarter fiscal 2026 with management emphasizing a familiar message that gained more weight in its latest earnings call. The company believes disciplined pricing, a broader brand mix and steady unit growth can keep it ahead of the casual dining industry. That framing mattered as DRI posted adjusted EPS of $3.66, topping the Zacks Consensus Estimate of $3.63 by 0.8%. Revenues of $3.72 billion came in just below the $3.73 billion consensus mark, with a negative surprise of 0.4%. Darden Restaurants, Inc. price-consensus-eps-surprise-chart | Darden Restaurants, Inc. Quote CEO Ricardo Cardenas used much of his prepared commentary to argue that DRI’s portfolio is becoming more balanced and less dependent on Olive Garden. Cardenas said the company’s reach across cuisines, price points and dining occasions reduces reliance on any one brand and gives management more levers to drive growth. CFO Rajesh Vennam backed that up by noting Olive Garden represented 42% of fiscal 2026 sales and 47% of segment profit, down from 50% and 55%, respectively, in fiscal 2019. Vennam said that the shift reflected both LongHorn’s consistent expansion and a bigger contribution from the rest of the portfolio, including acquisitions. That broader mix sits behind management’s long-term case for 3% to 4% unit growth, with Olive Garden expected to trend toward the low end, LongHorn to the high end and smaller brands growing at or above that range. Darden’s fiscal 2027 outlook was one of the call’s clearest investor takeaways. Management guided for total sales of $13.6 billion to $13.75 billion, same-restaurant sales growth of 2.5% to 3.5%, EBITDA of $2.26 billion to $2.29 billion and EPS of $11.10 to $11.35. The assumptions underneath that range were equally important. Vennam said the outlook includes about 3% total inflation, including commodities inflation of about 3% and labor inflation of about 3.5%, plus roughly $875 million in capital spending and 75 to 80 gross openings. He also highlighted 11 Bahama Breeze conversions and said the step-up in openings would create about a $15 million profit impact and roughly a 10-cent EPS drag for the year. Even with that added growth cost, management said the guidance still implies a flat to positive earnings-after-tax margin. On the demand backdrop, Cardenas said consumer spending remained resilient even as sentiment stayed cautious. He told analysts that the company did not see a major change from recent quarters and the same-restaurant sales cadence was fairly consistent through the quarter. That message was supported by the quarter’s operating numbers. DRI reported 4.6% same-restaurant sales growth, positive traffic growth and adjusted EBITDA of $678 million, while management said both same-restaurant sales and guest counts exceeded the industry benchmark by more than 300 basis points. Cardenas also pointed to a year-over-year increase in visits from all income groups at the company’s casual brands, including the lowest income quintile. He said guests under 35 were softer, but management’s tone on overall demand remained steady rather than defensive. Questions around Olive Garden centered on value, traffic and margin durability. Vennam said the brand should land near the lower end of DRI’s 2.5% to 3.5% same-restaurant sales range in fiscal 2027, but he also said margins should be flat to positive. Cardenas defended the company’s approach to “lighter portions” and other menu changes as long-term brand investments rather than short-term traffic tactics. He confirmed the items are not being heavily featured, but customers using them are returning more frequently, and management will keep applying filters around simplicity, value and brand equity. In another notable Q&A exchange, management said Olive Garden made meaningful progress on speed of service in the last quarter, with service and pace-of-meal scores rising. That suggested operational execution, not just menu news, remains central to the brand’s plan for fiscal 2027. LongHorn was the clearest standout on the call. The chain posted 9.5% same-restaurant sales growth in the quarter, and management said its value, food quality and service continue to resonate with guests. Cardenas said years of food-quality investment are still paying off, while Vennam noted the brand’s average unit volumes have climbed to $5.6 million after more than 20% same-restaurant sales growth over the past three years. Fiscal fourth-quarter segment profit margin reached 21.2%, up 110 basis points from a year earlier. Management also acknowledged some trade-down from fine dining and some trade-in from retail. That exchange reinforced the idea that LongHorn is benefiting from both brand-specific execution and a favorable value position in a high-beef-inflation environment. The closing tone of the call was measured and consistent. Management repeatedly returned to controlling what it can control, especially execution, pricing discipline and new-unit growth, instead of relying on a stronger industry backdrop. DRI also paired that posture with continued shareholder returns. The company returned $310 million in the quarter and $1.4 billion in fiscal 2026. The board approved an 8% increase in the quarterly dividend to $1.62 per share. DRI carries a Zacks Rank #3 (Hold), along with a Value Score of C, Growth Score of B, Momentum Score of A and VGM Score of B. Under Zacks’ framework, the rank remains the first screen, while Style Scores help gauge value, growth and momentum characteristics over the next one to three months. That combination points to supportive growth and momentum characteristics, but a Hold-rated stock does not carry the same near-term implication as a Zacks Rank #1 (Strong Buy) or 2 (Buy). The current rank can also change as earnings estimate revisions move after the quarter. You can see the complete list of today’s Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Darden Restaurants, Inc. (DRI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Darden Restaurants, Inc. DRI reported fourth-quarter fiscal 2026 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis. Following the results, the stock inched down 3.4% in today's pre-market trading session, likely reflecting the revenue miss and fiscal 2027 guidance that calls for moderating same-restaurant sales growth following the benefit of a 53rd week in fiscal 2026.The quarter benefited from a blended same-restaurant sales increase of 4.6%, an extra week of operations and contributions from 43 net new restaurants. During the fiscal fourth quarter, Darden reported adjusted earnings per share (EPS) of $3.66, which beat the Zacks Consensus Estimate of $3.63. In the prior-year quarter, DRI reported adjusted EPS of $2.98. Darden Restaurants, Inc. price-consensus-eps-surprise-chart | Darden Restaurants, Inc. Quote Total sales during the quarter were $3.72 billion, missing the consensus mark of $3.74 billion. Sales increased 13.7% from the prior-year quarter's level. This upside was backed by a blended same-restaurant sales increase of 4.6%. Also, contributions from 43 net new restaurants and an extra week of operations added to the positives. Darden reports business under four segments — Olive Garden, LongHorn Steakhouse, Fine Dining (including The Capital Grille and Eddie V's) and Other Business.During the fiscal fourth quarter, sales at Olive Garden increased 11.4% year over year to $1.54 billion. Our estimate for the metric was $1.53 billion. Same-restaurant sales in the segment increased 2.4% year over year compared with 3.2% growth reported in the previous quarter.At LongHorn Steakhouse, sales were up 21.9% year over year to $1.02 billion. Our estimate for the metric was $967.1 million. Same-restaurant sales in the segment rose 9.5% year over year compared with 7.2% growth reported in the previous quarter.Sales in Fine Dining increased 10.9% year over year to $371 million. Our estimate for the metric was $358.4 million. Same-restaurant sales in the segment rose 1.9% year over year compared with 2.1% growth reported in the previous quarter.Sales in Other Business increased 9.8% year over year to $793.3 million. Our estimate for the metric was $875.9 million. Same-restaurant sales in the segment rose 4.6% year over year compared with a 3.9% increase reported in the previous quarter. In the fiscal fourth quarter, total operating costs and expenses increased 10.8% year over year to $3.20 billion. The increase was primarily due to higher food and beverage costs, restaurant labor expenses, restaurant expenses, marketing expenses, pre-opening costs and depreciation and amortization.Operating income increased to $516.8 million from $382.8 million reported in the prior-year quarter. Excluding charges primarily related to restaurant closures, associated impairments and the Chuy's integration, adjusted earnings per share from continuing operations increased 22.8% year over year to $3.66. As of May 31, 2026, cash and cash equivalents were $219.5 million compared with $240 million as of May 25, 2025.Inventories were $326.3 million compared with $311.6 million reported a year ago. Long-term debt declined to $1.64 billion from $2.13 billion at the end of fiscal 2025.During the quarter, the company repurchased approximately 0.7 million shares for $138 million. Darden also increased its quarterly cash dividend by 8% to $1.62 per share and authorized a new $1.5 billion share repurchase program. Total sales in fiscal 2026 amounted to $13.21 billion compared with $12.08 billion in fiscal 2025.Operating income in fiscal 2026 totaled $1.58 billion compared with $1.36 billion reported in fiscal 2025.In fiscal 2026, adjusted earnings per share from continuing operations were $10.64 compared with $9.55 reported in the previous year. Blended same-restaurant sales increased 4.5% during the year, supported by gains of 4% at Olive Garden, 7.2% at LongHorn Steakhouse, 1.2% in Fine Dining and 3.9% in Other Business. For fiscal 2027, the company expects total sales in the range of $13.60-$13.75 billion. Same-restaurant sales growth is anticipated to be between 2.5% and 3.5%.Darden expects to open 75-80 new restaurants and incur total capital spending of approximately $875 million. The company projects earnings per share from continuing operations between $11.10 and $11.35, EBITDA in the range of $2.26-$2.29 billion, an effective tax rate of approximately 13.5% and about 114 million weighted average shares outstanding. Darden currently carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the Zacks Retail-Wholesale sector have been discussed below.Five Below, Inc. FIVE currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.FIVE has a trailing four-quarter earnings surprise of 70.1%, on average. The Zacks Consensus Estimate for FIVE’s 2026 sales and EPS indicates growth of 14.7% and 34.3%, respectively, from the year-ago period’s levels.Starbucks Corporation SBUX presently flaunts a Zacks Rank of 1. SBUX has a trailing four-quarter negative average earnings surprise of 4.6%.The consensus estimate for Starbucks’ fiscal 2026 sales and EPS indicates growth of 12.7% and 2.9%, respectively, from the year-ago period’s levels.On Holding ONON currently holds a Zacks Rank of 2 (Buy). ONON has a trailing four-quarter negative average earnings surprise of 11.3%.The Zacks Consensus Estimate for On Holding’s 2026 sales and EPS indicates growth of 24.5% and 80.4%, respectively, from the year-ago period’s levels. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Starbucks Corporation (SBUX) : Free Stock Analysis Report Darden Restaurants, Inc. (DRI) : Free Stock Analysis Report Five Below, Inc. (FIVE) : Free Stock Analysis Report On Holding AG (ONON) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research