Here’s Why Darling Ingredients (DAR) Traded Lower in Q3

Aristotle Atlantic Partners, LLC, an investment advisor, released its “Core Equity Strategy” third-quarter 2025 investor letter. The letter highlighted the market review, quarterly performance, and attribution analysis. A copy of the letter can be downloaded here. In the quarter, the US equity market rallied, with the S&P 500 Index reaching 8.12%. Bonds also finished higher in the period, with the Bloomberg U.S. Aggregate Bond Index increasing 2.03%. The composite has returned 7.22% gross of fees (7.10% net of fees) in the quarter, underperforming the S&P 500 Index’s 8.12% gain. Security selection led to the relative underperformance of the strategy in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Aristotle Atlantic Core Equity Strategy highlighted stocks such as Darling Ingredients Inc. (NYSE:DAR). Darling Ingredients Inc. (NYSE:DAR) develops, produces, and sells natural ingredients from edible and inedible bio-nutrients. The one-month return of Darling Ingredients Inc. (NYSE:DAR) was 9.31%, and its shares lost 19.56% of their value over the last 52 weeks. On November 4, 2025, Darling Ingredients Inc. (NYSE:DAR) stock closed at $34.63 per share, with a market capitalization of $5.478 billion.

Aristotle Atlantic Core Equity Strategy stated the following regarding Darling Ingredients Inc. (NYSE:DAR) in its third quarter 2025 investor letter:

“Darling Ingredients Inc. (NYSE:DAR) detracted from performance in the third quarter as uncertainty around the timelines for the U.S. Environmental Protection Agency (EPA) finalizing the proposed Renewable Volume Obligations (RVOs) weighed on sentiment. In September, there was favorable news that the EPA was proposing to reallocate some of the credits forgiven under the Small Refinery Exemption (SRE), which could raise the ultimate RVOs into next year and thus enable a more favorable backdrop for margins on renewable diesel. We believe that 2025 has played out with positive catalysts for Darling; however, the lack of finalization of the proposals led to investors being in more of a wait-and-see mode.”

Darling Ingredients (DAR) Soars 9% on Trump's Biofuel Policy

Darling Ingredients Inc. (NYSE:DAR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 50 hedge fund portfolios held Darling Ingredients Inc. (NYSE:DAR) at the end of the second quarter, up from 47 in the previous quarter.  Darling Ingredients Inc. (NYSE:DAR) reported net sales of $1.6 billion in Q3 2025 compared to $1.4 billion in Q3 2024. While we acknowledge the risk and potential of Darling Ingredients Inc. (NYSE:DAR) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Darling Ingredients Inc. (NYSE:DAR) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Darling Ingredients Inc. (NYSE:DAR) and shared SouthernSun Small Cap Strategy’s views on the company. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.