JPMorgan analyst Thomas Palmer downgraded Darling Ingredients to Neutral citing valuation with the shares up 39% year-to-date as well as regulatory risk. The U.S. Commerce Department's preliminary duties on biodiesel imports from Argentina and Indonesia were greater than anticipated and the EPA's decision to potentially reduce biomass-based diesel mandates for 2018 and 2019 could also weigh on pricing, Palmer tells investors in a research note. The analyst lowered his price atrget for the shares to $18 from $19.

Reports Q1 revenue $1.4B, consensus $1.48B. "For several years, we have enjoyed tailwinds from a demand-driven global economy and strong global commodity and specialty ingredient prices. We are now adapting to the new reality of abundant global supplies. This is a cycle we have seen many times, and we are making the necessary adjustments in our procurement process and lowering our operating costs where feasible to gain back our margin leverage," said Randall C. Stuewe, Darling Ingredients chairman and CEO. "Globally we are seeing very nice progress and improvement in April for our core specialty ingredient business, and DGD has finally worked through its higher-priced feedstock pipeline. We anticipate an improved performance for the rest of the year."