Darling International Down to Strong Sell - Analyst Blog

By Zacks Equity Research,

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Zacks Investment Research downgraded Darling International Inc. ( DAR ) to a Zacks Rank #5 (Strong Sell) on Aug 29, 2013.

Why the Downgrade?

Darling International reported a disappointing second quarter 2013 financial results on Aug 8, 2013. The company's share price since then has dropped by 2.3%. Net earnings per share in the quarter fell 29.0% year over year to 22 cents and 18.5% below the Zacks Consensus Estimate of 27 cents.

Revenue in the quarter was down 3.0% year over year due to lower finished product prices for fats. Talking of expenses and margins, total costs and expenses in the quarter increased 22.8%. Slight decline in cost of sales and operating expenses were offset by increases in SG&A expenses and depreciation and amortization.

Operating margin in the quarter was 12.0%, down 260 basis points from 14.6% in the year-ago quarter.

Darling International has a negative earnings surprise average of 19.3%. Also, in the last 30 days, the Zacks Consensus Estimate for the company has gone down by 5.2% to $1.09 for 2013 and has declined 5.0% to $1.33 for 2014.

Other Stocks to Consider

Darling International is a well known provider of rendering and bakery residuals recycling solutions to the nation's food industry. The company currently has a market capitalization of $2.4 billion.

Other stocks to watch out for in the industry are The Andersons, Inc. ( ANDE ) and Progressive Waste Solutions Ltd. ( BIN ), each with a Zacks Rank #1 (Strong Buy) while Sharps Compliance Corp. ( SMED ) comes with a Zacks Rank #2 (Buy).

ANDERSONS INC (ANDE): Free Stock Analysis Report

PROGRESSV WASTE (BIN): Free Stock Analysis Report

DARLING INTL (DAR): Free Stock Analysis Report

SHARPS COMPLIAN (SMED): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Stocks: ANDE , BIN , DAR , SMED

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