Jason Gabelman, an analyst from TD Cowen, maintained the Hold rating on Darling Ingredients. The associated price target remains the same with $34.00.
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Jason Gabelman has given his Hold rating due to a combination of factors affecting Darling Ingredients’ financial outlook. One of the primary reasons is the downward revision of the company’s EBITDA estimates for the upcoming quarters, particularly due to weaker-than-expected performance in the Diamond Green Diesel (DGD) segment. Despite some regulatory improvements, DGD margins remain under pressure, and there is uncertainty regarding the finalization of small refinery exemptions and the 2026 Renewable Volume Obligations (RVO).
Additionally, the pricing dynamics of waste oils are not favorable, which limits the benefits from lower-carbon intensity waste oils. This, coupled with the lack of announcements regarding the monetization of credits, adds to the uncertainty. Furthermore, the company’s current trading multiples are aligned with historical averages, suggesting limited upside potential. These factors together contribute to the Hold rating, as the stock’s performance may not significantly exceed market expectations in the near term.
Based on the recent corporate insider activity of 56 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of DAR in relation to earlier this year.