Darling Ingredients Inc.’s DAR Feed Ingredients segment emerged as a key performance driver in the first quarter of 2026, reflecting improved performance in the core ingredients business. Despite a stagnant North American cattle herd, the segment achieved substantial EBITDA growth, rising to $169 million from $111 million in the prior-year quarter. This improvement was driven mainly by strong global poultry volumes and better operational efficiency.
The segment’s resilience is further bolstered by shifting regulatory and market dynamics. The finalization of the Renewable Volume Obligation in late March 2026 has already begun to drive favorable movement in fat prices as renewable diesel demand grows. Management anticipates this regulatory framework will act as a sustained "tailwind" for the Feed segment throughout the remainder of 2026.
Furthermore, Darling Ingredients shifted sales toward higher-priced markets, helping offset weaker pricing earlier in the quarter and minimizing the usual delay in realizing price gains. This strategic execution, combined with a focus on product quality and cost reduction, resulted in significant margin expansion, with gross margins improving to 25.3% in the first quarter, compared with 20.3% in the same period last year.
Although volumes remained largely flat at around 3.1 million metric tons, stronger pricing and operational efficiencies highlight global feed demand as a key factor supporting the segment’s current momentum.
What Do the Latest Metrics Say About Darling Ingredients?
Darling Ingredients, which competes with Tyson Foods Inc. TSN and Ingredion Inc. INGR, has seen its shares rally 98.3% in the past year against the industry’s 24.5% decline. Shares of Tyson Foods have risen 22.6%, while Ingredion has declined 20% during the same period.
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From a valuation standpoint, Darling Ingredients’ forward 12-month price-to-earnings ratio stands at 14.5, higher than the industry’s 13.82. The company is trading at a discount to Tyson Foods (with a forward 12-month P/E ratio of 15.89) while trading at a premium to Ingredion (9.18).
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The Zacks Consensus Estimate for Darling Ingredients’ current fiscal-year sales and earnings per share implies year-over-year growth of 8.2% and 535.3%, respectively.
Darling Ingredients currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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