As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at waste management stocks, starting with Waste Connections (NYSE: WCN).
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 mixed Q1. As a group, revenues missed analysts’ consensus estimates by 1%.
Thankfully, share prices of the companies have been resilient as they are up 9.8% on average since the latest earnings results.
Waste Connections (NYSE: WCN)
Operating a network of municipal solid waste landfills in the U.S. and Canada, Waste Connections (NYSE: WCN) is North America's third-largest waste management company providing collection, disposal, and recycling services.
Waste Connections reported revenues of $2.23 billion, up 7.5% year on year. This print was in line with analysts’ expectations, and overall, it was a very strong quarter for the company with a solid beat of analysts’ organic revenue estimates and an impressive beat of analysts’ adjusted operating income estimates.
Unsurprisingly, the stock is down 7.5% since reporting and currently trades at $180.73.
Is now the time to buy Waste Connections? Access our full analysis of the earnings results here, it’s free.
Best Q1: 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 $177.8 million, up 14.5% year on year, outperforming analysts’ expectations by 6%. The business had a stunning quarter with a solid beat of analysts’ organic revenue estimates and an impressive beat of analysts’ EPS estimates.
Montrose delivered the biggest analyst estimates beat and highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 48.8% since reporting. It currently trades at $22.31.
Is now the time to buy Montrose? Access our full analysis of the earnings results here, it’s free.
Slowest 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 $13.92 million, up 2.2% year on year, falling short of analysts’ expectations by 9%. It was a disappointing quarter as it posted a significant miss of analysts’ EBITDA and EPS estimates.
Perma-Fix delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 25.1% since the results and currently trades at $11.07.
Read our full analysis of Perma-Fix’s results here.
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 $417.1 million, up 22.3% year on year. This result beat analysts’ expectations by 3.1%. Aside from that, it was a mixed quarter as it also recorded an impressive beat of analysts’ EPS estimates but a significant miss of analysts’ adjusted operating income estimates.
Casella Waste Systems pulled off the fastest revenue growth but had the weakest full-year guidance update among its peers. The stock is down 3.2% since reporting and currently trades at $113.35.
Read our full, actionable report on Casella Waste Systems here, it’s free.
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 $68.43 million, down 5.8% year on year. This print missed analysts’ expectations by 5%. Overall, it was a slower quarter as it also logged a significant miss of analysts’ EPS estimates.
The stock is down 12.2% since reporting and currently trades at $2.22.
Read our full, actionable report on Quest Resource here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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