SouthernSun Gained from Darling Components’ (DAR) Enterprise Stabilization

SouthernSun Asset Administration, LLC, an funding administration agency, launched its “SouthernSun Small Cap Technique” fourth-quarter 2025 investor letter. A duplicate of the letter might be downloaded right here. Throughout the quarter, the Small Cap Composite returned -2.45% on a gross foundation (-2.64% web) in comparison with 2.19% for the Russell 2000 Index and three.26% return for the Russell 2000 Worth Index. The Composite returned 6.21% on a gross foundation (5.40% web) over the trailing 12 months in comparison with 12.81% and 12.59% for the indexes, respectively. The letter highlighted the financial classes realized throughout the oil worth collapse of 2014-15. Initially seen as a optimistic growth for the worldwide economic system, the decline in oil costs later revealed underlying weaknesses, resulting in broader financial impacts past the power sector. The creator compares this to the present state of affairs with synthetic intelligence (AI), cautioning that whereas AI is now a elementary side of financial planning and decision-making, its related dangers have to be fastidiously analyzed. Because the market approaches 2026, the funding panorama is formed by varied situations, together with valuation compression and overcapacity in AI infrastructure, somewhat than inevitable outcomes. SouthernSun Asset Administration maintains a disciplined, humble strategy targeted on intrinsic worth and is optimistic in regards to the future however stays conscious of historic classes. As well as, please examine the Technique’s high 5 holdings to know its finest picks in 2025.

In its fourth-quarter 2025 investor letter, SouthernSun Small Cap Technique highlighted Darling Components Inc. (NYSE:DAR) as one in all its main contributors. Darling Components Inc. (NYSE:DAR) is a number one firm in growing and promoting pure substances from animal by merchandise and meals waste that operates by means of Feed Components, Meals Components, and Gas Components segments. On February 27, 2026, Darling Components Inc. (NYSE:DAR) inventory closed at $53.16 per share. One-month return of Darling Components Inc. (NYSE:DAR) was 12.27%, and its shares gained 54.45% over the previous 52 weeks. Darling Components Inc. (NYSE:DAR) has a market capitalization of $8.409 billion.

SouthernSun Small Cap Technique acknowledged the next concerning Darling Components Inc. (NYSE:DAR) in its fourth quarter 2025 investor letter:

“Darling Components Inc. (NYSE:DAR) was a high contributor within the Small Cap technique within the fourth quarter. DAR is the biggest publicly traded firm turning edible by-products and meals waste into sustainable merchandise and a number one producer of renewable power. Darling has confronted important headwinds over the previous couple of years, and the inventory traded inside a reasonably tight vary of $30-40 over the previous twelve months. This downturn is, in our opinion, at or close to a backside. We see a number of elementary and regulatory modifications supporting our view that high line and bottom-line outcomes will inflect greater in 2026. Current bulletins from Washington and from the corporate are supportive of our view. The bottom Meals and Feed companies are offering assist for the struggling Gas enterprise – a pure hedge we now have lengthy mentioned. As well as, the corporate’s vertically built-in provide chain and low-cost place have confirmed resilient within the face of such headwinds. We count on outcomes for 4q25 to be challenged and imagine this actuality is accounted for in immediately’s share worth. Because the cycle turns, the operational enhancements remodeled the previous couple of years along with an upgraded asset base will, in our opinion, present a lift to working profitability and discretionary money stream. Whereas pissed off with the efficiency over the previous couple of years, we have been happy to see stabilization within the enterprise and the inventory worth in latest quarters and imagine some significant aid is on the horizon.”