Raymond James reiterates Strong Buy on Darling Ingredients stock

Published 25/07/2025, 02:16
Raymond James reiterates Strong Buy on Darling Ingredients stock

Investing.com - Raymond (NSE:RYMD) James has reiterated its Strong Buy rating and $60.00 price target on Darling Ingredients (NYSE:DAR), citing the company’s long-term advantages in sustainable fuels despite recent challenging market conditions. According to InvestingPro data, the stock appears undervalued based on its Fair Value analysis, with analysts maintaining a strong consensus buy recommendation.

The firm believes Darling’s legacy Feed and Food business lines provide strategic integration value for its sustainable fuels operations, with its Diamond Green Diesel (DGD) joint venture maintaining a first-mover advantage in renewable diesel and sustainable aviation fuel markets. The company, currently valued at $5.6 billion, maintains a healthy current ratio of 1.4, indicating strong operational stability.

Darling Ingredients reported second-quarter adjusted EBITDA of approximately $250 million, compared to consensus estimates of around $255 million and Raymond James’ estimate of $235 million. The company’s trailing twelve-month EBITDA stands at $809 million. InvestingPro subscribers can access detailed financial analysis and 6 additional key insights about DAR’s performance and outlook.

The company’s Food segment performed in line with expectations on higher pricing, while the Feed segment came in below projections due to lighter pricing and a larger-than-expected lag effect.

The DGD joint venture reported stronger-than-modeled results, primarily benefiting from LCM inventory adjustments, though Raymond James noted these results were partially offset by LIFO headwinds that may be "under-appreciated" by investors.

In other recent news, Darling Ingredients reported financial results for the second quarter of 2025 that did not meet analyst expectations. The company’s earnings per share were $0.08, significantly below the forecasted $0.30. Additionally, revenue reached $1.19 billion, falling short of the projected $1.49 billion. These figures highlight a challenging quarter for Darling Ingredients. The earnings miss has caught the attention of investors and analysts alike, prompting discussions about the company’s future performance. Despite the disappointing results, there have been no recent analyst upgrades or downgrades reported. Investors will likely be watching closely for any strategic changes or updates from the company. These developments are part of the ongoing analysis of Darling Ingredients’ financial health.

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