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More Reading from MarketBeat Media Darden Restaurants, Inc.: This is What a Strong Signal Looks LikeAuthor: Thomas Hughes. Published: 12/23/2025. 
What You Need to Know - 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 flashing a potential trend-following entry in late December after a sharp 2025 pullback. 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 Why Is Nobody Talking About What Just Happened at Mar-a-Lago?
He served on one of Trump's top advisory boards... and he's been a personal friend of the President for years... But what he just revealed at Mar-a-Lago about President Trump has made some people uncomfortable. The mainstream won't touch this story. But if you're an American patriot looking to build wealth, you need to hear what he's saying. Get the name and ticker of his #1 "Mandatory Payout" stock to buy now, FREE Weekly price action for DRI has been in an uptrend since 2014, interrupted mainly by COVID-19 volatility. More recently, a strong 2024 advance broke price action out of an Ascending Triangle pattern (a consolidation with flat, equal highs and progressively higher lows) and set a new all-time high. That move was supported by fundamentals, including growth, margin strength, and capital returns. The 2025 price action was less obviously bullish, with the stock falling about 25% from its peak to the November 2025 low. Nevertheless, the long-term uptrend remains unbroken. That drawdown wasn't pleasant, but it did two useful things for trend followers: it pulled price back toward long-term support and allowed momentum gauges to unwind from extended conditions. It also allowed indicators such as the moving average convergence divergence (MACD) and stochastic to reset, and gave a key exponential moving average (EMA) time to catch up with price action. On the weekly frame that long-term EMA is the 150-week EMA, which has acted as a buy-and-hold support line aligned with DRI's uptrend for years. The takeaway in late December is that support at this important level is advancing, setting the stage for a rebound that has already begun. 
The MACD and stochastic indicators, which measure momentum and trend, clearly point to a technical trend-following entry. The recent price rebound, combined with bullish crossovers in both stochastic and MACD, constitutes a trend-following entry signal and suggests an uptrending market that can retest its prior highs and potentially move higher in 2026. Investors and traders should note, however, that late-December price action has reached a short-term ceiling that must be cleared to confirm continuation. The Next Hurdle: Reclaiming the 150-Day EMA to Confirm Accumulation Even with improving momentum, the chart still has a clear test ahead: reclaiming the 150-day EMA. Many traders treat that line as a proxy for intermediate-term accumulation. Rallies often stall while price remains below it; getting back above the 150-day EMA and holding through a retest frequently signals that dip buyers are back in control. At the moment, 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 give additional confirmation to 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 revenue growth accelerating to over 7%, with outperformance and substantial margin expansion driven by core business strength and comparable-store (same-store) sales. Cash flow and capital returns were healthy, including the roughly 3.1% yielding dividend and ongoing share buybacks. Buybacks have been meaningful: Darden reduced shares outstanding by about 1.2% in the first fiscal half and is expected to continue substantial repurchases in the second half. While restaurant-sector results helped set the tone, analysts and institutions ultimately drive the market. The FQ2 release prompted several price-target increases and upgrades, affirming the Moderate Buy rating and a roughly 20% upside projection. Institutions own more than 90% of the stock, and their 2025 activity amounted to roughly $2 in purchases for each $1 in sales. With that level of institutional demand, DRI's downside is more limited and its upside potential meaningful—provided the stock can clear the nearby resistance levels described above.
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