Trade-Ideas LLC identified Darling Ingredients ( DAR) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Darling Ingredients as such a stock due to the following factors:

  • DAR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $38.0 million.
  • DAR has traded 338,691 shares today.
  • DAR is trading at 6.21 times the normal volume for the stock at this time of day.
  • DAR is trading at a new low 3.03% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize (or avoid losses by trimming weak positions). In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on DAR:

Darling Ingredients Inc. develops, produces, and sells natural ingredients from edible and inedible bio-nutrients worldwide. It operates in three segments: Feed Ingredients, Food Ingredients, and Fuel Ingredients. DAR has a PE ratio of 17. Currently there are 3 analysts that rate Darling Ingredients a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Darling Ingredients has been 1.9 million shares per day over the past 30 days. Darling Ingredients has a market cap of $2.0 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.74 and a short float of 4% with 2.07 days to cover. Shares are down 23.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Darling Ingredients as a hold. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations and notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and unimpressive growth in net income.

Highlights from the ratings report include:
  • Net operating cash flow has significantly increased by 79.38% to $128.31 million when compared to the same quarter last year. In addition, DARLING INGREDIENTS INC has also vastly surpassed the industry average cash flow growth rate of 2.75%.
  • DAR, with its decline in revenue, slightly underperformed the industry average of 9.5%. Since the same quarter one year prior, revenues fell by 16.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Food Products industry. The net income has significantly decreased by 90.6% when compared to the same quarter one year ago, falling from $32.76 million to $3.08 million.
  • The gross profit margin for DARLING INGREDIENTS INC is rather low; currently it is at 22.23%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.35% trails that of the industry average.

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