Darden Restaurants (DRI) 10/28/09 PriceWatch Alert Targets 7.55% Downside Protection

Posted: Wednesday, October 28, 2009 8:23 AM EDT

Darden Restaurants (NYSE: DRI) closed yesterday at $31.11. So far the stock has hit a 52-week low of $13.21 and 52-week high of $41.21. Darden Restaurants stock has been showing support around 30.07 and resistance in the 32.01 range. Technical indicators for the stock are Bearish and S&P gives DRI a weak 2 STAR (out of 5) sell rating. DRI appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at a Dec '09 30 covered call (DRI LF) for a net debit in the $28.76 area. That is also the break even stock price for this trade. This covered call has a 52 day duration, provides 7.55% downside protection and a 4.31% assigned return rate for a 30.26% annualized return rate (comparison purposes only). Darden Restaurants has a current annual dividend yield of 3.20%. [WBA-Seven Summits Research]

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