Darden's Value Positioning Should Play Well in 2024 but Full-Service Restaurant Pressure Acute

Darden Restaurants' playbook strives to leverage its competitive advantages, with the restaurant operator leaning into its scale-driven cost edge, embracing datacentric decision-making, trying to attract and retain employees with compelling benefits and culture, and providing a differentiated dining experience, consistent with management's back-to-basics strategy. While we view this approach as strategically sound, we expect any success at Darden to come in spite of, rather than propelled by, aggregate industry results, with the full-service industry posting anemic average annual sales growth of just 1%-2% over the past decade, well behind limited-service peers' 3%-4% clip.