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Preheat oven to 350°F. Spread bread cubes in a shallow roasting pan. Bake about 20 minutes or until toasted, stirring twice; cool. Reduce oven temperature to 325°F.
Meanwhile, grease a 13x9x2-inch baking pan; set aside. In a large skillet melt butter over medium heat. Add onions and fennel; cook for 12 to 15 minutes or until fennel is tender, stirring occasionally. Stir in orange juice, apricots, figs, cherries, plums, snipped tarragon, salt, and nutmeg. Bring just to boiling; reduce heat. Simmer, uncovered, for 5 minutes. Stir in walnuts.
In an extra-large bowl combine bread cubes and fruit mixture. In a medium bowl combine eggs and milk. Add egg mixture to bread mixture, tossing gently to moisten. Transfer mixture to the prepared roasting pan.
Bake, covered, for 30 minutes. Bake, uncovered, about 30 minutes more or until heated through. If desired, garnish with tarragon.