Darling Ingredients Inc. (DAR)
Valuation Overview•Is Darling Ingredients Inc. Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
Fragile underlying quality score of 39/100; weak margins or elevated debt leverage warrant caution.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Mixed fundamental profile with offsetting strengths and weaknesses.
Wall Street is highly bullish, projecting significant upside alongside robust expected earnings growth. However, capital return yields remain modest, driven predominantly by aggressive share repurchases.
DAR struggles with subpar profitability and pressured margins. However, the balance sheet carries elevated leverage, requiring careful monitoring of debt servicing capabilities.
The company is facing top-line contraction (-2.0% 3Y CAGR) however, earnings have severely contracted over the same period. Operating efficiency remains adequate with margins around 6.4%.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $1.7B | +7.4% | -2.0% | +11.4% | +6.1% | |
| EBITDA | $284.1M | — | -14.0% | — | — | |
| Net Income | $56.9M | -77.5% | -56.0% | — | -2.2% | |
| EPS (Diluted) | $0.36 | -77.5% | -55.7% | -26.2% | -2.1% | |
| Free Cash Flow | $284.2M | +34.0% | +17.3% | +14.8% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 15.7% | 20.8% | 22.4% | 22.5% |
| Operating Margin | 6.4% | 9.5% | 12.6% | 10.6% |
| Net Margin | 1.0% | 5.1% | 8.1% | 6.8% |
| FCF Margin | 11.1% | 8.3% | 8.1% | 6.0% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.56 | $0.83 | +48.2% | ||
| Q1'26 | $0.43 | $0.64 | +48.8% | ||
| Q4'25 | $0.13 | $0.12 | -7.7% | ||
| Q3'25 | $0.12 | $0.09 | -25.0% | ||
| Q2'25 | $0.20 | $-0.16 | -180.0% | ||
| Q1'25 | $0.35 | $0.63 | +80.0% | ||
| Q4'24 | $0.40 | $0.11 | -72.5% | ||
| Q3'24 | $0.45 | $0.49 | +8.9% |
Total return is +39.2% (1Y), outperforming the benchmark by +14.3%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +42.6% | +33.3% | — |
| 1Y | +39.2% | +14.3% | — |
| 3YCAGR | -3.9% | -23.3% | — |
| 5YCAGR | -2.9% | -16.5% | — |
| 10YCAGR | +13.5% | 0.0% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Darling Ingredients Inc. (DAR) valuation, health, and returns.
Darling Ingredients Inc. is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. undervalued (implying +31.0% upside to DCF intrinsic value of $70.32)
Darling Ingredients Inc. has multiple valuation anchors: DCF Intrinsic Value: $70.32 | Peer Relative Fair Value: $90.31 | Wall Street Analyst Target: $65.33 (implying +21.7% upside). A convergence of these signals offers higher conviction.
Darling Ingredients Inc. displays weak financial health with a composite quality score of 39/100, supported by a Altman Z-Score of 1.7 (distress zone), Piotroski F-Score of 7/9, Return on Invested Capital (ROIC) of 3.4%.
Darling Ingredients Inc. does not return material capital to shareholders via dividends or share repurchases, electing to retain earnings to fund internal growth.
Darling Ingredients Inc.'s current growth trajectory is Accelerating. The company achieved +7.4% 1Y revenue growth and -77.5% 1Y EPS growth, compared to its 3Y revenue CAGR of -2.0%.
Wall Street consensus is Buy based on 25 analysts, beating EPS expectations in 33% of recent quarters with a 2-quarter streak. The consensus price target represents a +21.7% change from current levels.
Investment risks for Darling Ingredients Inc. include: -24.6% 1-year max drawdown, elevated distress risk. Volatility risk is characterized by a beta of 0.53x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.