The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how waste management stocks fared in Q2, starting with Casella Waste Systems (NASDAQ:CWST).
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 8 waste management stocks we track reported a weak Q2. As a group, revenues missed analysts’ consensus estimates by 1.9%.
Inflation progressed towards the Fed’s 2% goal at the end of 2023, leading to strong stock market performance. On the other hand, 2024 has been a bumpier ride as the market switches between optimism and pessimism around rate cuts and inflation. However, waste management stocks have held steady amidst all this with average share prices relatively unchanged since the latest earnings results.
Best Q2: 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 print exceeded analysts’ expectations by 1.2%. Overall, it was a decent quarter for the company with full-year revenue guidance exceeding analysts’ expectations but a miss of analysts’ earnings estimates.
"We continued to execute on our core operating strategies in the second quarter and have driven solid year-to-date performance," said John W. Casella, Chairman and CEO of Casella Waste Systems,
Casella Waste Systems achieved the fastest revenue growth and highest full-year guidance raise of the whole group. The results were likely priced in, however, and the stock is flat since reporting. It currently trades at $102.80.
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Quest Resource (NASDAQ:QRHC) Recycling corporate waste to help companies be more sustainable, Quest Resource (NASDAQ:QRHC) is a provider of waste and recycling services.
Quest Resource reported revenues of $73.15 million, down 1.8% year on year, falling short of analysts’ expectations by 4.6%. It performed better than its peers, but it was unfortunately a weak quarter for the company with a miss of analysts’ earnings estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 9.1% since reporting. It currently trades at $7.58.
Weakest Q2: 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 weak quarter for the company with a miss of analysts’ earnings estimates.
Perma-Fix had the weakest performance against analyst estimates and slowest revenue growth in the group. Interestingly, the stock is up 8.8% since the results and currently trades at $11.11.
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, surpassing analysts’ expectations by 1.5%. Revenue aside, it was a strong quarter for the company with a decent beat of analysts’ earnings estimates.
Clean Harbors scored the biggest analyst estimates beat among its peers. The stock is up 4.4% since reporting and currently trades at $234.35.
Montrose (NYSE:MEG) Founded to protect a tree-lined two-lane road, Montrose (NYSE:MEG) provides air quality monitoring, environmental laboratory testing, compliance, and environmental consulting services.
Montrose reported revenues of $173.3 million, up 8.9% year on year, in line with analysts’ expectations. More broadly, it was a weaker quarter for the company with a miss of analysts’ earnings and organic revenue estimates.
The stock is up 10.9% since reporting and currently trades at $32.45.
This content was originally published on Stock Story
