The Gory Details on Darling International's Double Miss

Darling International (NYS: DAR) reported earnings on Feb. 27. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 29 (Q4), Darling International missed estimates on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue contracted slightly. GAAP earnings per share shrank.


Gross margins dropped, operating margins dropped, net margins were steady.

Revenue details
Darling International notched revenue of $424.9 million. The eight analysts polled by S&P Capital IQ anticipated sales of $438.7 million on the same basis. GAAP reported sales were the same as the prior-year quarter's.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.24. The seven earnings estimates compiled by S&P Capital IQ predicted $0.29 per share. GAAP EPS of $0.24 for Q4 were 4.0% lower than the prior-year quarter's $0.25 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 26.1%, 100 basis points worse than the prior-year quarter. Operating margin was 11.6%, 220 basis points worse than the prior-year quarter. Net margin was 6.8%, much about the same as the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $405.1 million. On the bottom line, the average EPS estimate is $0.25.

Next year's average estimate for revenue is $1.74 billion. The average EPS estimate is $1.31.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,194 members out of 1,221 rating the stock outperform, and 27 members rating it underperform. Among 287 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 283 give Darling International a green thumbs-up, and four give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Darling International is hold, with an average price target of $18.25.

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The article The Gory Details on Darling International's Double Miss originally appeared on Fool.com.

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 recommends Darling International. The Motley Fool owns shares of 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.

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