Darling Ingredients Inc. DAR repurposes and recycles materials from the animal agriculture and food industries.
Darling Ingredients stock has tumbled over the last several years following its Covid boom. DAR’s drop coincides with its rapidly deteriorating earnings outlook.
Why Investors Might Want to Stay Away from Darling Ingredients
Darling Ingredients takes “materials that would otherwise be wasted” and “transforms them into hundreds ofvaluable ingredients that the world depends on daily.”
Darling Ingredients collects and transforms all aspects of animal by-product streams and beyond into broadly used and specialty ingredients. The company’s massive portfolio spans an array of offerings that play important roles in key areas of the economy.
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DAR produces gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, fuel feedstock, green energy, natural casings and hides, and more.
Darling Ingredients posted strong revenue growth over the last few years, including back-to-back years of over 33% revenue growth in 2021 and 2022. DAR’s earnings also soared during that stretch. But that run was nearly impossible to follow as the economy normalized in the post-Covid world.
DAR’s revenue is projected to decline by 12% in 2024. On top of that, its adjusted earnings are projected to plummet 41% from $4.15 a share to $2.45 a share in FY24. DAR’s FY24 consensus 2024 earnings estimate has tumbled 49% over the last year, with its FY25 estimate 33% lower.
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Bottom Line on DAR Stock
Darling Ingredients’ most accurate/most recent EPS estimate for 2025 came in 26% below consensus. The company’s downward revisions land Darling Ingredients a Zacks Rank #5 (Strong Sell).
Darling Ingredients last quarter saw some improvements in various business segments. On top of that, CEO Randall Stuewe said its “focus for the balance of the year remains on paying down debt and widening margins through effective cost cutting.”
DAR shares have fallen 48% in the last three years. That said, DAR has soared 100% in the last five years and 433% during the past 15.
Still, investors might not want to call a bottom on Darling Ingredients just yet given its recent downward revisions for FY25.
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Darling Ingredients Inc. (DAR): Free Stock Analysis Report
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