Darling Ingredients Inc. (DAR) A Top Defensive Stock Amid Margin Expansion and Debt Reduction

Darling Ingredients Inc. (NYSE: DAR ) is one of the best defensive stocks to buy amid geopolitical tensions . On May 12, TD Cowen reiterated a Buy rating and a $76 price target on Darling Ingredients Inc. (NYSE:DAR), buoyed by strong margin conditions across the company’s business segments.

The research firm remains confident that the company will benefit from significant margin expansion opportunities rather than volume growth in the current operating environment. According to TD Cowen, there is potential upside of $150 million to $300 million from Feed margin expansion and $80 million from the Food segment.

The research firm also expects Darling Ingredients to generate significant cash flow, which should help reduce debt below target levels by early next year. While the company has yet to shed light on potential capital allocation priorities once debt targets are reached, it is also unlikely to pursue large-scale mergers and acquisitions.

TD Cowen insists Darling Ingredients is its top pick in its coverage universe amid its heightened focus on debt reduction through cash generation.

Darling Ingredients Inc. (NYSE:DAR) is the world’s largest repurposer of food and animal waste. The company takes organic by-products from the meat, poultry, and food industries and transforms them into sustainable ingredients for human food, pet food, animal feed, and renewable energy.

While we acknowledge the potential of DAR as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock .

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