Yahoo Finance

Brinker International, Inc. EAT and Darden Restaurants, Inc. DRI are two major casual dining operators in the United States. Both stocks have outperformed the industry over the past year, showing resilience in a challenging environment. But with market volatility adding pressure, which stock offers the better value and more upside potential right now?

The Case for Brinker

EAT’s efforts to drive traffic and revenues through sales-building initiatives, such as the streamlining of its menu and its innovation, the strengthening of its value proposition and better food presentation, bode well.

In the second quarter of fiscal 2025, Brinker witnessed traffic and guest count growth on the bank of marketing campaigns, including the Better Than Fast-Food TV campaign and the Triple Dipper social media campaign. Sales at Chili’s rose 31.4% and traffic increased 19.9% year over year. As operations improve, the company is seeing higher returns on marketing investments through more frequent guest visits.

EAT’s focus on expansion efforts continues to drive growth. In fiscal 2024, the company opened nine new Chili's restaurants. For fiscal 2025, Chili’s has nine to 11 domestic openings and 21-25 international openings scheduled in the pipeline.

Brinker emphasizes menu adjustments to drive growth. In the second quarter of fiscal 2025, the company continued to drive momentum with food innovation. Following the success of the natural hot mozzarella sticks, EAT introduced Honey Chipotle Mozz Sticks, which likely fueled social media excitement around the Triple Dipper campaign. The campaign's impact was significant with Triple Dipper accounting for 14% of total sales in the fiscal second quarter, up from the fiscal first quarter.
The company is planning more food innovations in the fiscal fourth quarter, including a new item that will enhance the 3 For Me platform and build on the success of the Big Smasher launch. Brinker expects this new menu item to help increase traffic from a year ago.

The Case for Darden

The company is benefiting from the robust performance of Cheddar's Scratch Kitchen. The acquisition of Cheddar's Scratch Kitchen has added an undisputed casual dining value to the company’s portfolio of differentiated brands. It also helped Darden to enhance its scale.

Recently, DRI and Uber have expanded their partnership to include Cheddar’s Scratch Kitchen in an on-demand delivery pilot program. The initiative, currently underway at 10 Cheddar’s Scratch Kitchen locations, allows customers to place orders directly through the restaurant's website and mobile app. Uber Direct, Uber’s national delivery network, facilitates the deliveries, ensuring seamless service.