The 10-second takeaway
For the quarter ended Sep. 29 (Q3), Darling International beat slightly on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank slightly and GAAP earnings per share shrank.
Margins contracted across the board.
Darling International reported revenue of $452.7 million. The seven analysts polled by S&P Capital IQ looked for sales of $444.7 million on the same basis. GAAP reported sales were 0.7% lower than the prior-year quarter's $455.9 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.31. The six earnings estimates compiled by S&P Capital IQ anticipated $0.31 per share. GAAP EPS of $0.31 for Q3 were 11% lower than the prior-year quarter's $0.35 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 27.6%, 70 basis points worse than the prior-year quarter. Operating margin was 14.5%, 190 basis points worse than the prior-year quarter. Net margin was 8.2%, 80 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $455.8 million. On the bottom line, the average EPS estimate is $0.34.
Next year's average estimate for revenue is $1.72 billion. The average EPS estimate is $1.20.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,159 members out of 1,188 rating the stock outperform, and 29 members rating it underperform. Among 271 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 266 give Darling International a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Darling International is outperform, with an average price target of $19.93.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Darling International. Motley Fool newsletter services recommend Darling International. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.