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GuruFocus has detected 6 Warning Signs with Darden Restaurants Inc $DRI.
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Darden Restaurants Inc (NYSE:DRI)
COGS-to-Revenue
0.80 (As of Nov. 2016)

Darden Restaurants Inc's cost of goods sold for the three months ended in Nov. 2016 was $1,322 Mil. Its revenue for the three months ended in Nov. 2016 was $1,643 Mil.

Darden Restaurants Inc's COGS to Revenue for the three months ended in Nov. 2016 was 0.80.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Darden Restaurants Inc's Gross Margin for the three months ended in Nov. 2016 was 19.54%.


Definition

Darden Restaurants Inc's COGS to Revenue for the fiscal year that ended in May. 2016 is calculated as

COGS to Revenue=Cost of Goods Sold / Revenue
=5392.4 / 6933.5
=0.78

Darden Restaurants Inc's COGS to Revenue for the quarter that ended in Nov. 2016 is calculated as

COGS to Revenue=Cost of Goods Sold / Revenue
=1321.5 / 1642.5
=0.80

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Explanation

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin.

Darden Restaurants Inc's Gross Margin for the three months ended in Nov. 2016 is calculated as:

Gross Margin=1 - COGS to Revenue
=1 - Cost of Goods Sold / Revenue
=1 - 1321.5 / 1642.5
=19.54 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

A company that has a “moat” can usually maintain or even expand their Gross Margin. A company can increase its Gross Margin in two ways. It can increase the prices of the goods it sells and keeps its Cost of Goods Sold unchanged. Or it can keep the sales price unchanged and squeeze its suppliers to reduce the Cost of Goods Sold. Warren Buffett believes businesses with the power to raise prices have “moats”.


Related Terms

Cost of Goods Sold, Gross Margin, Revenue


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Darden Restaurants Inc Annual Data

May07May08May09May10May11May12May13May14May15May16
cogs2rev 0.760.780.780.770.760.770.780.790.790.78

Darden Restaurants Inc Quarterly Data

Aug14Nov14Feb15May15Aug15Nov15Feb16May16Aug16Nov16
cogs2rev 0.800.810.780.770.780.800.770.770.780.80
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