As the Q1 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the waste management industry, including Stericycle (NASDAQ:) and its peers.
Waste management companies can possess licenses permitting them to handle hazardous materials. Furthermore, many services are performed through contracts and statutorily mandated, non-discretionary, or recurring, leading to more predictable revenue streams. However, regulation can be a headwind, rendering existing services obsolete or forcing companies to invest precious capital to comply with new, more environmentally-friendly rules. Lastly, waste management companies are at the whim of economic cycles. Interest rates, for example, can greatly impact industrial production or commercial projects that create waste and byproducts.
The 9 waste management stocks we track reported a slower Q1. As a group, revenues missed analysts’ consensus estimates by 1.9%.
The Fed cut its policy rate by 50bps (half a percent) in September 2024, the first in roughly four years. This marks the end of its most pointed inflation-busting campaign since the 1980s. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be assessing whether this rate cut’s timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.
Thankfully, waste management stocks have been resilient with share prices up 5.1% on average since the latest earnings results.
Stericycle (NASDAQ:SRCL)
Founded in 1989, Stericycle (NASDAQ:SRCL) provides waste disposal and sensitive information destruction services to healthcare organizations and other businesses.
Stericycle reported revenues of $664.9 million, down 2.8% year on year. This print fell short of analysts’ expectations by 1.7%. Overall, it was a slower quarter for the company with a miss of analysts’ organic revenue estimates.
“We are pleased with our first quarter results, which reflect improvement in adjusted EBITDA and adjusted EPS, driven by disciplined execution across our key priorities,” said Cindy J. Miller, President and Chief Executive Officer.
Interestingly, the stock is up 21.9% since reporting and currently trades at $60.80.
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Best Q1: Clean Harbors (NYSE:CLH)
Established in 1980, Clean Harbors (NYSE:CLH) provides environmental and industrial services like hazardous and non-hazardous waste disposal and emergency spill cleanups.
Clean Harbors reported revenues of $1.55 billion, up 11.1% year on year, outperforming analysts’ expectations by 1.5%. The business had a very strong quarter with an impressive beat of analysts’ operating margin estimates and a solid beat of analysts’ EBITDA estimates.
Clean Harbors scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 13.8% since reporting. It currently trades at $255.49.
Weakest Q1: Perma-Fix (NASDAQ:PESI)
Tackling hazardous waste challenges since 1990, Perma-Fix (NASDAQ:PESI) provides environmental waste treatment services.
Perma-Fix reported revenues of $13.99 million, down 44.1% year on year, falling short of analysts’ expectations by 12%. It was a disappointing quarter as it posted a miss of analysts’ EBITDA and earnings estimates.
Perma-Fix delivered the weakest performance against analyst estimates and slowest revenue growth in the group. Interestingly, the stock is up 41.9% since the results and currently trades at $14.49.
Enviri (NYSE:NVRI)
Cooling America’s first indoor ice rink in the 19th century, Enviri (NYSE:NVRI) offers steel and waste handling services.
Enviri reported revenues of $610 million, flat year on year. This result came in 1.1% below analysts’ expectations. It was a disappointing quarter as it also logged a miss of analysts’ EBITDA estimates.
The stock is down 17.1% since reporting and currently trades at $9.81.
Casella Waste Systems (NASDAQ:CWST)
Starting with the founder picking up garbage with a pickup truck he purchased using savings from high school, Casella (NASDAQ:CWST) offers waste management services for businesses, residents, and the government.
Casella Waste Systems reported revenues of $377.2 million, up 30.2% year on year. This number surpassed analysts’ expectations by 1.2%. However, it was a slower quarter as it produced a miss of analysts’ operating margin estimates.
Casella Waste Systems scored the fastest revenue growth and highest full-year guidance raise among its peers. The stock is flat since reporting and currently trades at $102.16.
This content was originally published on Stock Story
