• Darling Ingredients Inc. has reported fourth-quarter 2025 revenue of US$1,709.8 million, up from US$1,417.69 million a year earlier, while quarterly net income fell to US$56.94 million and full-year net income dropped to US$62.8 million despite higher annual sales of US$6,135.88 million.
• Behind these headline figures, the company delivered adjusted EBITDA above expectations with sequential gross margin improvement, suggesting its core ingredients operations helped offset weaker profitability and challenges in the Diamond Green Diesel joint venture.
• We’ll now examine how the stronger-than-expected EBITDA and margin improvement might influence Darling Ingredients’ longer-term investment narrative.

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Darling Ingredients Investment Narrative Recap

To own Darling Ingredients, you need to believe its core rendering and specialty ingredients businesses can translate policy support for renewable fuels into steadier margins, while earnings catch up with recent revenue growth. The latest quarter supports that idea on EBITDA and gross margin, but weak net income and a still‑challenged Diamond Green Diesel (DGD) keep policy and utilization as the key near term catalyst and the biggest risk. This earnings print does not remove that tension; it simply buys some time.

The most relevant recent development is Darling’s fourth quarter adjusted EBITDA of US$336.1 million, which exceeded expectations and came with sequential gross margin improvement and lower net debt of about US$3.8 billion. That combination of better profitability and modest deleveraging matters for the catalyst tied to regulatory clarity on Renewable Volume Obligations, because it shows the balance sheet and core operations are holding up while investors wait for firmer policy signals.

Yet behind the improving EBITDA, investors should be aware that regulatory uncertainty around renewable fuel policy could still...

Darling Ingredients' narrative projects $6.5 billion revenue and $673.1 million earnings by 2028. This requires 4.3% yearly revenue growth and about a $567.7 million earnings increase from $105.4 million today.

Uncover how Darling Ingredients' forecasts yield a $47.46 fair value, a 7% downside to its current price.

Exploring Other Perspectives

Before this earnings release, the most optimistic analysts were expecting revenue to reach about US$6.8 billion and earnings near US$891 million by 2028, assuming strong policy support and premium collagen growth. Compared with the baseline focus on DGD utilization and regulatory timing, this brighter view leans heavily on faster biofuel tailwinds and high margin health ingredients. These new results may prompt you to compare those very different paths and decide which outlook feels closer to reality.

Explore 3 other fair value estimates on Darling Ingredients - why the stock might be worth 7% less than the current price!

Build Your Own Darling Ingredients Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Darling Ingredients research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Darling Ingredients research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Darling Ingredients' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.