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This Month's Featured Story Darden Restaurants, Inc.: This is What a Strong Signal Looks LikeAuthored by Thomas Hughes. Posted: 12/23/2025. 
Quick Look - Darden Restaurants is testing long-term trend support after a steep pullback, creating a potential trend-following entry setup.
- Recent quarterly results showed solid sales and same-restaurant sales growth, alongside continued dividends and buybacks.
- Heavy institutional ownership and net inflows suggest support if the stock confirms a breakout back above key moving averages.
Darden Restaurants, Inc.'s (NYSE: DRI) stock is showing a potential trend-following entry in late December after a sharp pullback in 2025. The core thesis is straightforward: the long-term uptrend appears intact, momentum indicators are turning, and fundamentals—paired with institutional positioning—create a credible path to market-beating total returns in 2026 if the stock clears nearby resistance. Darden Restaurants Pulls Back to Trend-Following Entry Point in Q4 Elon Musk's Starlink project is generating major speculation ahead of a potential IPO that some analysts believe could reach a historic $100 billion valuation. According to James Altucher, there may be a smart "backdoor" way for everyday investors to position ahead of that event without needing traditional IPO access — and he says it can be done for under $100. He's also sharing a free ticker tied to this trend for anyone who wants to take a closer look. Click here to learn more Weekly price action for DRI stock has been in an uptrend since 2014, interrupted mainly by COVID-19 volatility. More recently, a robust 2024 rally broke price action out of an Ascending Triangle pattern (a consolidation with flat highs and progressively higher lows) and set a new all-time high. That advance was supported by growth, margin strength, and capital returns. The 2025 price action has been less bullish: the stock fell about 25% from its peak to the November 2025 low. Despite the decline, the uptrend remains intact. The drawdown pulled price nearer to long-term support and gave momentum gauges a chance to unwind from extended conditions—useful developments for trend followers. Specifically, indicators such as the moving average convergence divergence (MACD) and stochastic have reset, and a key exponential moving average (EMA) has begun catching up with price. The EMA in question is the 150-day EMA, an intermediate-term support that has aligned with the DRI uptrend line for years. In late December, that support is advancing, setting the stage for a rebound that is already underway. 
The MACD and stochastic—momentum and trend measures—are signaling a technical trend-following entry. The price rebound, together with bullish crossovers in stochastic and MACD, constitutes the entry signal and suggests the market can retest its recent highs and potentially move higher in 2026. Traders should note, however, that late-December price action encountered nearby resistance that must be cleared. The Next Hurdle: Reclaiming the 150-Day EMA to Confirm Accumulation Even with improving momentum, an obvious test remains: reclaiming the 150-day EMA. Many investors treat that line as a proxy for intermediate-term accumulation. When price is below it, rallies can stall; when price moves back above it and holds, it often signals that dip buyers are back in control. The market appears to be digesting the rebound that followed the most recent earnings catalyst. A clean push above the 150-day EMA—followed by a successful retest—would provide additional confirmation for traders who want more than an initial bounce. Earnings Catalyst: What Darden Just Reported and Why It Matters The earnings results for fiscal Q2 (FQ2) showed year-over-year growth accelerating to over 7%, outperformance versus expectations, and substantial margin strength driven by core business and comparable-store sales. Cash flow and capital returns remain healthy, including the 3.1% yielding dividend and ongoing share buybacks. Buybacks have already reduced the share count by 1.2% in the first fiscal half and are expected to remain robust in the second half. While restaurant results helped spark the move, analysts and institutional activity are major drivers. The FQ2 release prompted several price-target increases and upgrades, supporting the Moderate Buy rating and a roughly 20% upside forecast. Institutions own more than 90% of the stock, and their 2025 activity amounted to about $2 in purchases for every $1 in sales. With that buying pressure, DRI's downside looks limited while upside potential appears meaningful. If the stock can clear nearby resistance and reclaim the 150-day EMA on convincing volume, DRI looks well positioned to retest its highs and potentially deliver strong returns in 2026. Traders should watch for a clean breakout and a successful EMA retest as confirmation.
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