Part 9/14:
Insights on Darden:
Despite higher costs, management remains confident in its ability to attract customers through value offerings and menu innovation.
Olive Garden has rolled out premium items like steak and shrimp Bucatini, appealing to customers willing to pay for quality.
The company’s focus on "price certainty" and delivery partnerships (e.g., Uber Direct) help attract and retain patrons.
Traffic increases across income groups demonstrate resilience, and Darden’s strategic emphasis on value, engagement, and quality sustains its appeal, even in inflationary times.
Kramer advocates for holding onto Darden stock, given its compelling valuation—about 17 times earnings and a 3.25% dividend—expecting it to weather inflation temporarily and appreciate over time.