Issue #52: The dominant brand in the DIY moving and storage industry and a rising recycler of what used to be waste products.

Amerco, working through its U-Haul brand, is North America’s leading provider of rented trucks, trailers, and self-moving supplies. It’s also a leading provider of rented storage space and moving-related insurance and supplies. It’s a stable company with a wide moat, a solid balance sheet, and surprisingly high growth.  

Darling Ingredients Inc. turns waste products from the livestock, poultry, food processing, and restaurant industries into valuable products sold to a range of businesses. Growth is strong and institutional investors are buying and holding.

Amerco ($UHAL)



  • Share price at the time of writing: $514.86
  • Amerco is a leading provider of self-moving equipment, supplies and related products and services in the US and Canada. 
  • The Company has also developed one of North America’s largest self-storage portfolios.
  • $UHAL is showing solid growth rates, with excellent margins and attractive valuation ratios. 
  • The $UHAL float is tiny and a high level of insider and institutional ownership protects against panic selling.

What they do:

Amerco’s subsidiary U-Haul International is North America’s leading provider of rented moving equipment. U-Haul has 176,000 trucks, 126,000 trailers, and 46,000 towing devices for rent across the US and Canada.

Amerco rents its trucks, towed trailers, and towing equipment through a network of 2,065 company-owned stores and 20,100 independent dealers. These outlets also sell or rent U-Haul brand utility dollies, boxes, tape, pads, and other self-moving products and services.

U-Haul uses truck chassis’ sourced from US manufacturers. They then mount U-Haul-designed van bodies on the chassis at manufacturing facilities in the US. The van bodies are designed for easy loading and access and feature special storage spaces for fragile goods.

Amerco is the 3rd largest provider of self-storage facilities in the US, owning and managing over 73 million square feet of self-storage space in 1,745 locations. 

Amerco also provides property, casualty, and life insurance, which are typically bundled to provide full insurance coverage for the moving and storage process.

Amerco offers packages that include multiple services and products.

  • The U-Box program lets customers bring a mobile storage unit to their location, either themselves or by company personnel, and move it to a storage location, with the entire process fully insured.
  • The Safemove and Safetow programs provide moving and towing customers with cargo protection, medical, and life insurance for a fully insured self-moving experience.

A large majority of revenues come from the Moving and Storage segment, with the balance derived from insurance services.

Source: Zack’s

What we learned from social media patterns:

Amerco is virtually invisible on social media.

This is not surprising. $UHAL is the epitome of the anti-meme stock: a traditional business with no exciting technology or potential for exponential gains. It may get an occasional reference on a thread dealing with value stocks or defensive plays, but it will never go viral.

Smart Money Signal: Donald Yaktman of Yacktman Asset Management holds 712,000 shares of $UHAL, with 263,000 purchased as share prices slumped in Q1 2022.

Why $UHAL could be valuable:

The self-storage and moving services market is currently worth $80 billion a year. It’s projected to grow to $126.5 billion by 2027, with a CAGR of 6.6%. Climate-controlled self-storage services are expected to grow at a CAGR of 7.2%.

The U-Haul brand is absolutely dominant in the DIY moving segment. “U-Haul” has become synonymous with rented moving trucks and trailers.

Amerco operates in multiple businesses with strong synergies, and has developed highly specific product lines to support those synergies. U-Haul doesn’t just sell boxes and pads for moving, they sell specific packaging materials designed to protect common household goods. Their truck bodies and trailers are specifically designed to support self-moving.

Both self-storage and moving services are used by people in life transitions, and can be packaged together along with relevant insurance and other associated goods and services.

U-Haul storage facilities offer a wide range of storage sizes and are highly secure. Climate-controlled storage is a strong draw for people who need to store valuable items.

Amerco’s business has proven to be highly resilient, with revenues barely affected by the COVID-19 pandemic.

Source: Yahoo! Finance

Amerco is likely to perform well in a recession. The total volume of moving may drop, but cash-strapped individuals are more likely to opt for a DIY solution and people who are downsizing drive demand for storage.

$UHAL posted exceptional 2021 results.

  • Total revenues increased 14.2%. 
  • Both transaction volume and average revenue per transaction increased.
  • Increased sales of hitches, moving supplies, and propane drove a 30.1$ increase in moving supplies revenue.
  • Self-storage revenue was up 14%, driven by a 9% increase in capacity (3.7 million square feet of storage space added) and an 18% increase in the number of units occupied.
  • Total costs increased by only 4.1%, despite high inflation.
  • Earnings from operations increased 77.9%.

The addition of new self-storage units was slowed by the pandemic, but the Company has announced multiple new facilities in 2021, indicating that growth is increasing.

These are exceptionally strong growth rates for a legacy business that has been operating since 1945 and dominates its industry.

Amerco faces competition in moving and in self-storage, but no competitor operates across both industries to anything close to the same extent.

$UHAL boasts a very solid 28.85% operating margin and 21% return on equity. The trailing P/E is only 9.13 and Price/Sales is 1.71, low relative to the Company’s growth.

Based on an average 11.7 annual earnings growth over the last 5 years, the Price/Earnings Growth (PEG) ratio is only .79. A PEG Ratio under 1 is considered a sign that a company is undervalued relative to earnings growth.

$UHAL has only 19.61 million shares outstanding, very low for a company this size. 54.06% of those shares are held by insiders and another 38.98% are held by institutions, leaving only 7% of the shares – only 1.4 million shares – circulating. With roughly 93% of the shares in the hands of insiders and institutions, it’s unlikely that the share price will fluctuate radically on panic selling.

The extremely small float means that any increase in retail investor purchases could move the share price quickly.

What the risks are:

1️⃣ Fleet management has been affected by lack of new vehicles. Supply chain constraints on motor vehicle production have left Amerco unable to source as many truck chassis as they need. The company is keeping existing units in service longer than it usually would. This could increase maintenance expenses and down time, affecting results.

2️⃣ Delays or limitations in the development of new storage space. Amerco was unable to acquire and build as much new storage space as it planned to acquire during the pandemic.

Inability to build or purchase enough new space may affect the growth rate of self-storage revenues.

3️⃣Amerco is highly dependent on one individual. Edward J. Schoen serves simultaneously as Board Chairman, President and CEO. Mr. Schoen and his brother own Willow Grove Holdings LP, which owns 42.8% of AMERCO’s shares. Significant disruption is possible if Mr. Schoen’s ability to fill these roles is compromised.

Bottom line: $UHAL is a stable, secure business with a dominant brand, a wide competitive moat, and a solid balance sheet. The stock is down almost 30% from its Nov. 2021 peak, and the decline seems entirely driven by a weak market, not by any issue with the Company.

Darling Ingredients Inc. ($DAR)



  • Share price at the time of writing: $79.26
  • Darling Ingredients describes itself as “the world’s leading producer of sustainable natural ingredients”.
  • $DAR collects waste products from industries like meat and poultry processing, industrial baking, and food supply and recycles them into high quality pure ingredients.
  • Darling Ingredients sells its products to customers in the food, animal feed, energy, health & medical and other industries.
  • Revenues and earnings are on a solid growth trend, shares are up despite the general market rout, and analyst ratings are high.

What they do:

Darling Ingredients produces sustainable chemical products from organic waste products left behind from other industries. These are then recycled into high-quality raw materials for the food, animal feed, pet food, pharmaceutical, biofuel, and fertilizer industries.

$DAR is a global company with operations in North and South America, Europe, Asia, and Australia. 

Darling uses waste products from other industries as raw materials. These include:

  • Animal by-products from the meat and poultry industries.
  • Recycled cooking oils and animal fats.
  • Industrial bakery waste.

Darling processes these items to create sellable products such as:

  • Collagen
  • Edible fats
  • Feed-grade fats
  • Animal proteins and meals (meat and bone meal)
  • Biofuels
  • Natural sausage casings
  • Plasma and whole blood

Darling also provides grease trap collection and disposal services to food service and food production establishments.

Diamond is a partner (with Valero Energy) in Diamond Green Diesel, which converts cooking oils and animal fats into biofuels.

Diamond’s Enviroflight division is pioneering the use of cultured Black Soldier Fly larvae in animal feeds and other industries.

Darling provides ingredients and custom solutions to the food, animal feed, pet food, pharmaceutical, fuel, and fertilizer industries.

Darling is the only publicly-traded company operating in its industry and faces no large-scale competition. Some companies may provide competition on a limited scale in certain markets and certain subsets of the industry.

What we learned from social media and institutional investment patterns:

Darling Ingredients operates in a niche business where it is effectively the only player. It is not a glamorous business (more the opposite) and it’s far from being a household name. There’s no celebrity CEO or high-tech product.

Given those realities, it’s slightly surprising to see that $DAR has a bit of a following on social media.

The early May spike is clearly built around a much anticipated and very satisfactory quarterly results release.

While $DAR gets a surprising number of mentions, almost all of them are in the context of broader discussions. Most appear in “daily discussion” threads or general stock discussions, often focused on non-tech growth stocks. Recent $DAR-specific Reddit threads have attracted little or no discussion.

We can gather that while the company is on the radar of some social media discussions, the commitment level is relatively low. The stock is probably not going to go viral, but positive results could get enough attention to potentially drive retail buying.

???? Smart Money Signal ????Chris Davis of Davis Finds has purchased 3.22 million shares in the last year.

Why $DAR could be valuable:

It is difficult to identify an industry trend for $DAR because the company is effectively the sole player in its industry. Data do indicate that the availability of raw materials should not be a problem for the company.

$DAR also stands to benefit from growing environmental regulations. Livestock producers need waste disposal solutions and recycling is an attractive option that gets rid of unwanted materials and gains environmental sensitivity points for an industry that is often criticized on environmental grounds.

Darling Ingredients sells to a huge range of industries, most of which handle basic commodities (food, pet food, livestock feed, pharmaceuticals, energy) that are recession-resistant. 

Darling’s global footprint gives it exposure in emerging markets where per capita meat consumption and production are rising rapidly.

Diamond Green Diesel is expected to produce 750 million gallons of green diesel fuel in 2022 and is well placed to benefit from prevailing high prices of motor vehicle fuels.

$DAR recently acquired Valley Proteins Inc, one of the largest independent rendering companies in the US. The acquisition includes 18 major rendering plants and used cooking oil facilities in the US and will expand Darling’s renewable fuel operations.

Darling’s early move into exploiting insect protein as an ingredient in animal feed places it in a leadership position in developing less resource-intensive sources of animal protein.

Because Darling’s raw materials are waste products from other companies, the company sees reduced impact from cost inflation and supply chain issues.

$DAR has demonstrated resilience, sustaining and even growing revenues through the COVID-19 pandemic. Since the end of pandemic-related restrictions revenue and earnings growth have accelerated dramatically. Q1 2022 revenues were up 37% over the equivalent quarter last year and earnings jumped 24%. reports that institutions own 95.07% of $DAR stock, with Blackrock, Vanguard, and T. Rowe Price the main institutional holders.

$DAR trades at 14.62x expected 2022 earnings and 2.73x trailing 12 months sales. The operating margin is 11.26% and Return on Equity is 20.86%. These are not spectacular numbers but they are solid and indicate at least a fair value for a growing company with no meaningful competition.

$DAR has beaten analyst earnings estimates for 4 consecutive quarters. Eight analysts cover the stock, with three rating it a “Strong Buy”, four saying “Buy”, and one saying “Hold”. The average price target is $98.14, 22% above the current price.

$DAR is up 11% since the beginning of the year, showing resilience in the face of a general market downturn.

What the risks are:

1️⃣  Many $DAR products see significant price volatility associated with commodity markets. The currently prevailing environment of high commodity prices could reverse, affecting revenues.

2️⃣ $DAR transforms waste products into end products that are used in human and animal consumption. If the purity and safety of the end products is compromised there could be significant liability and corporate image issues.

3️⃣ Many of the $DAR’s raw materials, processes, and products are heavily regulated. Significant regulatory changes in any of the markets where the Company operates or sells its products could have an impact on results.

Bottom line: $DAR has established itself as the sole player in a business niche with high resilience and enormous potential. Unlike many pioneering businesses, it is not speculative: the Company is solidly profitable and showing excellent growth rates.

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