Investment Thesis
The Coronavirus pandemic has dealt a severe blow to the restaurant industry, and the dine-in operations are fast becoming obsolete as the patrons stay indoors amid the widespread lockdown measures. With a fledgling off-premise business, the impact is even more severe for Darden Restaurants, Inc. (DRI), while the QSR operators with robust delivery networks fare reasonably well. Even if the downturn drags on, the company, backed by its balance sheet strength, is well-positioned to sustain its operations. However, in our view, that alone cannot justify the steep premium it now commands