Barclays Initiates Darling Coverage with Equal Weight Rating
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Source: seekingalpha
- Coverage Initiation: Barclays has initiated coverage on Darling Ingredients (DAR) with an Equal Weight rating and a $58 price target, noting that much of the favorable renewable fuels policy backdrop has already been reflected in the stock price, contributing to a 1.1% decline.
- Cash Flow Enhancement: The joint venture, Diamond Green Diesel, processes approximately 1.2 billion gallons of renewable diesel fuel annually, benefiting from stricter low-carbon fuel standards and record-high renewable volume obligations for 2026-27, which strengthen cash flows.
- Policy Risks: Analyst Theresa Chen highlights that the market is awaiting news on whether additional small refinery exemptions will be reallocated, which could negatively impact RIN prices and increase near-term risk uncertainties.
- Strategic Shift: Darling's future growth increasingly depends on management's push into higher-margin health and wellness markets, particularly through its collagen-based ingredients business and the anticipated joint venture with Tessenderlo.
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Analyst Views on DAR
Wall Street analysts forecast DAR stock price to fall
8 Analyst Rating
8 Buy
0 Hold
0 Sell
Strong Buy
Current: 53.220
Low
45.00
Averages
51.88
High
62.00
Current: 53.220
Low
45.00
Averages
51.88
High
62.00
About DAR
Darling Ingredients Inc. is a developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, animal feed, industrial, fuel, bioenergy and fertilizer industries. Its segments include Feed Ingredients, Food Ingredients and Fuel Ingredients. The Feed Ingredients segment includes its global activities related to the collection and processing of beef, poultry and pork animal by-products in North America, Europe and South America into non-food grade oils and protein meals, and others. The Food Ingredients segment includes its global activities related to the purchase and processing of beef and pork bone chips, beef hides, pig skins, and fish skins into collagen, and others. The Fuel Ingredients segment converts fats into renewable fuels/products, organic sludge and food waste into biogas, and fallen stock into low-grade energy sources.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Barclays Initiates Darling Coverage with Equal Weight Rating
- Coverage Initiation: Barclays has initiated coverage on Darling Ingredients (DAR) with an Equal Weight rating and a $58 price target, noting that much of the favorable renewable fuels policy backdrop has already been reflected in the stock price, contributing to a 1.1% decline.
- Cash Flow Enhancement: The joint venture, Diamond Green Diesel, processes approximately 1.2 billion gallons of renewable diesel fuel annually, benefiting from stricter low-carbon fuel standards and record-high renewable volume obligations for 2026-27, which strengthen cash flows.
- Policy Risks: Analyst Theresa Chen highlights that the market is awaiting news on whether additional small refinery exemptions will be reallocated, which could negatively impact RIN prices and increase near-term risk uncertainties.
- Strategic Shift: Darling's future growth increasingly depends on management's push into higher-margin health and wellness markets, particularly through its collagen-based ingredients business and the anticipated joint venture with Tessenderlo.
See More
Bullish Thesis on Darling Ingredients Inc. Stock
- Market Performance: As of June 2, Darling Ingredients Inc.'s stock was trading at $60.34, reflecting a robust market performance with a 67.19% appreciation over the past year, indicating strong investor confidence.
- Earnings Driver: The Fuel Ingredients segment, particularly the Diamond Green Diesel joint venture with Valero, is projected to achieve a capacity of approximately 1.2 billion gallons by 2026, driving EBITDA close to $2 billion, showcasing significant profitability potential.
- Policy Impact: The EPA's finalized Set 2 rule on March 27, 2026, will materially tighten the Renewable Fuel Standard, expected to increase RIN prices and enhance Darling's margins, especially given its low-cost production advantages.
- Valuation Upside: Under conservative valuation scenarios, Darling's stock implies a 70% upside to around $100 per share, with potential to reach $120 at historical multiples, highlighting substantial investment appeal.
See More
Darling Ingredients Secures Patent for Nextida GC Collagen Peptide
- Patent Grant: Darling Ingredients and its health brand Rousselot announced that the U.S. Patent and Trademark Office granted Patent No. US12636339 for Nextida GC, a pioneering collagen peptide ingredient aimed at supporting healthy post-meal blood sugar levels, showcasing the company's innovative capabilities in health nutrition.
- Growing Market Demand: As demand for natural, non-pharmaceutical health management solutions rises, Darling Ingredients strengthens its leadership in collagen health ingredients through Nextida GC, which is expected to drive future product line expansion and increase market share.
- International Patent Strategy: Nextida GC has secured patents in Australia, Europe, Japan, and China, with additional applications pending in Brazil, Canada, Colombia, Korea, Mexico, India, and Peru, indicating broad global recognition and potential for the product.
- Company Overview: Darling Ingredients operates over 260 facilities worldwide, processes about 15% of animal agricultural by-products, and produces approximately 30% of the world's collagen, demonstrating its strategic significance in sustainable development through a circular economy model.
See More
Wall Street Bullish on BBWI and Other Stocks Despite Concerns
- BBWI Sales Weakness: Bath and Body Works (BBWI) has experienced declining same-store sales over the past two years, with projected sales down 2.9% over the next year, indicating limited opportunities for new store openings in its core markets, which could impact future profitability.
- DAR Revenue Decline: Darling Ingredients (DAR) has seen a 3.2% annual revenue decline over the past three years, and its low gross margin of 23.8% reflects intense competition and poor unit economics, leading to a 25.6% annual contraction in earnings per share, putting pressure on stock prices.
- NESR Rising Costs: NESR's modest revenue base of $1.43 billion limits its fixed cost leverage, with a gross margin of only 12.7%, and costs have risen faster than revenue over the past five years, causing a 48.4 percentage point decline in EBITDA margin, affecting its investment capacity.
- Market Opportunity Assessment: While Wall Street's price targets suggest potential upside for these stocks, analysts express caution regarding the fundamentals of BBWI, DAR, and NESR, advising investors to consider more promising investment opportunities.
See More
Sky Quarry Signs Multi-Party MOU for Clean Fuel Innovation
- Strategic Collaboration: On May 7, 2026, Sky Quarry signed a non-binding multi-party Memorandum of Understanding with Southern Energy Renewables and DevvStream, aimed at advancing fuel innovation and low-carbon fuel development, with an initial term of three years, indicating the company's strategic positioning in the clean fuel sector.
- Integration Advantage: Sky Quarry's Foreland Refinery, the only operating refinery in Nevada, combined with its 180-million-barrel oil sands resource at PR Spring in Utah, creates a unique upstream and downstream integration capability, potentially evolving into a next-generation fuel production hub.
- Market Reaction: Within the U.S. sustainable aviation fuel investment cycle, Sky Quarry's partnership may shift market perceptions of small-cap operators, especially against the backdrop of larger competitors like Calumet and Gevo, highlighting Sky Quarry's structural advantages.
- Policy Support: The MOU coincides with a shift in U.S. federal energy policy, as the White House supports the development of domestic petroleum refining capacity, providing a favorable policy environment for Sky Quarry's integrated operations and potentially facilitating its future commercialization efforts.
See More
NYSE Issues Daily Pre-Market Advisory
- Market Advisory Issued: The New York Stock Exchange (NYSE) released a daily pre-market advisory on May 11, 2026, aimed at providing investors with market insights before trading begins, thereby assisting them in making informed trading decisions.
- Opening Celebration: At the opening bell, Eli Lilly (NYSE:LLY) celebrates its 150th anniversary, marking the company's long-standing influence and ongoing innovation in the pharmaceutical industry.
- Investor Day Event: Darling Ingredients (NYSE:DAR) showcased its long-term growth path during its Investor Day, emphasizing the company's strategic planning in sustainability and market expansion.
- Market Information Access: Investors can download the NYSE TV app to access daily market dynamics, IPO activities, and opening information, further enhancing their market engagement and information acquisition capabilities.
See More
Barclays Initiates Darling Coverage with Equal Weight Rating
- Coverage Initiation: Barclays has initiated coverage on Darling Ingredients (DAR) with an Equal Weight rating and a $58 price target, noting that much of the favorable renewable fuels policy backdrop has already been reflected in the stock price, contributing to a 1.1% decline.
- Cash Flow Enhancement: The joint venture, Diamond Green Diesel, processes approximately 1.2 billion gallons of renewable diesel fuel annually, benefiting from stricter low-carbon fuel standards and record-high renewable volume obligations for 2026-27, which strengthen cash flows.
- Policy Risks: Analyst Theresa Chen highlights that the market is awaiting news on whether additional small refinery exemptions will be reallocated, which could negatively impact RIN prices and increase near-term risk uncertainties.
- Strategic Shift: Darling's future growth increasingly depends on management's push into higher-margin health and wellness markets, particularly through its collagen-based ingredients business and the anticipated joint venture with Tessenderlo.
See More
Bullish Thesis on Darling Ingredients Inc. Stock
- Market Performance: As of June 2, Darling Ingredients Inc.'s stock was trading at $60.34, reflecting a robust market performance with a 67.19% appreciation over the past year, indicating strong investor confidence.
- Earnings Driver: The Fuel Ingredients segment, particularly the Diamond Green Diesel joint venture with Valero, is projected to achieve a capacity of approximately 1.2 billion gallons by 2026, driving EBITDA close to $2 billion, showcasing significant profitability potential.
- Policy Impact: The EPA's finalized Set 2 rule on March 27, 2026, will materially tighten the Renewable Fuel Standard, expected to increase RIN prices and enhance Darling's margins, especially given its low-cost production advantages.
- Valuation Upside: Under conservative valuation scenarios, Darling's stock implies a 70% upside to around $100 per share, with potential to reach $120 at historical multiples, highlighting substantial investment appeal.
See More
Darling Ingredients Secures Patent for Nextida GC Collagen Peptide
- Patent Grant: Darling Ingredients and its health brand Rousselot announced that the U.S. Patent and Trademark Office granted Patent No. US12636339 for Nextida GC, a pioneering collagen peptide ingredient aimed at supporting healthy post-meal blood sugar levels, showcasing the company's innovative capabilities in health nutrition.
- Growing Market Demand: As demand for natural, non-pharmaceutical health management solutions rises, Darling Ingredients strengthens its leadership in collagen health ingredients through Nextida GC, which is expected to drive future product line expansion and increase market share.
- International Patent Strategy: Nextida GC has secured patents in Australia, Europe, Japan, and China, with additional applications pending in Brazil, Canada, Colombia, Korea, Mexico, India, and Peru, indicating broad global recognition and potential for the product.
- Company Overview: Darling Ingredients operates over 260 facilities worldwide, processes about 15% of animal agricultural by-products, and produces approximately 30% of the world's collagen, demonstrating its strategic significance in sustainable development through a circular economy model.
See More
Wall Street Bullish on BBWI and Other Stocks Despite Concerns
- BBWI Sales Weakness: Bath and Body Works (BBWI) has experienced declining same-store sales over the past two years, with projected sales down 2.9% over the next year, indicating limited opportunities for new store openings in its core markets, which could impact future profitability.
- DAR Revenue Decline: Darling Ingredients (DAR) has seen a 3.2% annual revenue decline over the past three years, and its low gross margin of 23.8% reflects intense competition and poor unit economics, leading to a 25.6% annual contraction in earnings per share, putting pressure on stock prices.
- NESR Rising Costs: NESR's modest revenue base of $1.43 billion limits its fixed cost leverage, with a gross margin of only 12.7%, and costs have risen faster than revenue over the past five years, causing a 48.4 percentage point decline in EBITDA margin, affecting its investment capacity.
- Market Opportunity Assessment: While Wall Street's price targets suggest potential upside for these stocks, analysts express caution regarding the fundamentals of BBWI, DAR, and NESR, advising investors to consider more promising investment opportunities.
See More
Sky Quarry Signs Multi-Party MOU for Clean Fuel Innovation
- Strategic Collaboration: On May 7, 2026, Sky Quarry signed a non-binding multi-party Memorandum of Understanding with Southern Energy Renewables and DevvStream, aimed at advancing fuel innovation and low-carbon fuel development, with an initial term of three years, indicating the company's strategic positioning in the clean fuel sector.
- Integration Advantage: Sky Quarry's Foreland Refinery, the only operating refinery in Nevada, combined with its 180-million-barrel oil sands resource at PR Spring in Utah, creates a unique upstream and downstream integration capability, potentially evolving into a next-generation fuel production hub.
- Market Reaction: Within the U.S. sustainable aviation fuel investment cycle, Sky Quarry's partnership may shift market perceptions of small-cap operators, especially against the backdrop of larger competitors like Calumet and Gevo, highlighting Sky Quarry's structural advantages.
- Policy Support: The MOU coincides with a shift in U.S. federal energy policy, as the White House supports the development of domestic petroleum refining capacity, providing a favorable policy environment for Sky Quarry's integrated operations and potentially facilitating its future commercialization efforts.
See More
NYSE Issues Daily Pre-Market Advisory
- Market Advisory Issued: The New York Stock Exchange (NYSE) released a daily pre-market advisory on May 11, 2026, aimed at providing investors with market insights before trading begins, thereby assisting them in making informed trading decisions.
- Opening Celebration: At the opening bell, Eli Lilly (NYSE:LLY) celebrates its 150th anniversary, marking the company's long-standing influence and ongoing innovation in the pharmaceutical industry.
- Investor Day Event: Darling Ingredients (NYSE:DAR) showcased its long-term growth path during its Investor Day, emphasizing the company's strategic planning in sustainability and market expansion.
- Market Information Access: Investors can download the NYSE TV app to access daily market dynamics, IPO activities, and opening information, further enhancing their market engagement and information acquisition capabilities.
See More
