Stericycle, Inc.’s (SRCL - Free Report) reported mixed fourth-quarter 2023 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same.
The stock jumped 6.2% since the release of results on Feb 28 in response to the better-than-expected earnings and impressive guidance.
For 2024, Stericycle expects adjusted earnings per share (EPS) to be between $2.2 and $2.5, the midpoint ($2.35) of which is above the Zacks Consensus Estimate of $2.26.
SRCL’s quarterly EPS (excluding 38 cents from non-recurring items) came in at 54 cents, which surpassed the consensus estimate by 14.9% but declined 10% on a year-over-year basis. Revenues of $652 million missed the consensus mark marginally and declined 2.7% year over year.
The company’s shares have soared 21.4% in the past six months, underperforming the 21.9% rally of the industry it belongs to.
Segmental Revenues
Regulated Waste and Compliance Services revenues declined 2.1% from fourth-quarter 2022 but increased 3.1% on an organic basis to $439.9 million, topping our estimated $438.9 million.
Secure Information Destruction revenues decreased 4.1% from the year-ago quarter and 3.6% on an organic basis to $212.1 million, missing our estimate of $218.3 million. This segment's revenues were hurt by declining recycling revenues and lower fuel and environmental fees.
Revenues by Geography
Revenues from North America were $560.1 million, missing our estimate of $560.4 million and down marginally on a year-over-year basis. However, it increased less than 1% organically. International revenues of $91.9 million declined 12.1% from the year-ago quarter but were up 1.3% organically and missed our expectation of $96.9 million.
Profitability Performance
Adjusted EBITDA was $110.3 million, down 6.2% from the year-ago quarter’s figure. Adjusted EBITDA margin was 16.9%, down 60 basis points.
Balance Sheet & Cash Flow
Stericycle exited the quarter with cash and cash equivalents of $35.3 million compared with $29.7 million at the end of the third-quarter of 2023. Long-term debt was $1.3 billion, flat with the preceding quarter. SRCL generated $50 million of net cash from operating activities, while capex was $29.1 million.
2024 Guidance
The company expects 3-5% revenue growth organically. Stericycle expects free cash flow to be between $210 million and $265 million. It anticipates capital expenditures between $140 million and $160 million.
Currently, Stericycle carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot of Peers
Republic Services, Inc. (RSG - Free Report) reported an impressive fourth-quarter 2023 results.
RSG’s EPS, excluding 2 cents from non-recurring items, of $1.41 beat the Zacks Consensus Estimate by 10.2% and increased 24.8% year over year. Revenues of $3.8 billion surpassed the consensus mark by 2.9% and increased 8.6% year over year.
Envestnet, Inc. (ENV - Free Report) reported impressive fourth-quarter 2023.
ENV’s EPS, excluding $4 from non-recurring items, were 65 cents, surpassing the consensus estimate by 22.6%. The bottom line increased 44.4% from the year-ago quarter. Total revenues of $317.6 million beat the consensus estimate by 1.7%. The top line improved 8.5% on a year-over-year basis.
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Stericycle, Inc.’s (SRCL - Free Report) reported mixed fourth-quarter 2023 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same.
The stock jumped 6.2% since the release of results on Feb 28 in response to the better-than-expected earnings and impressive guidance.
For 2024, Stericycle expects adjusted earnings per share (EPS) to be between $2.2 and $2.5, the midpoint ($2.35) of which is above the Zacks Consensus Estimate of $2.26.
SRCL’s quarterly EPS (excluding 38 cents from non-recurring items) came in at 54 cents, which surpassed the consensus estimate by 14.9% but declined 10% on a year-over-year basis. Revenues of $652 million missed the consensus mark marginally and declined 2.7% year over year.
The company’s shares have soared 21.4% in the past six months, underperforming the 21.9% rally of the industry it belongs to.
Segmental Revenues
Regulated Waste and Compliance Services revenues declined 2.1% from fourth-quarter 2022 but increased 3.1% on an organic basis to $439.9 million, topping our estimated $438.9 million.
Secure Information Destruction revenues decreased 4.1% from the year-ago quarter and 3.6% on an organic basis to $212.1 million, missing our estimate of $218.3 million. This segment's revenues were hurt by declining recycling revenues and lower fuel and environmental fees.
Revenues by Geography
Revenues from North America were $560.1 million, missing our estimate of $560.4 million and down marginally on a year-over-year basis. However, it increased less than 1% organically. International revenues of $91.9 million declined 12.1% from the year-ago quarter but were up 1.3% organically and missed our expectation of $96.9 million.
Profitability Performance
Adjusted EBITDA was $110.3 million, down 6.2% from the year-ago quarter’s figure. Adjusted EBITDA margin was 16.9%, down 60 basis points.
Balance Sheet & Cash Flow
Stericycle exited the quarter with cash and cash equivalents of $35.3 million compared with $29.7 million at the end of the third-quarter of 2023. Long-term debt was $1.3 billion, flat with the preceding quarter. SRCL generated $50 million of net cash from operating activities, while capex was $29.1 million.
2024 Guidance
The company expects 3-5% revenue growth organically. Stericycle expects free cash flow to be between $210 million and $265 million. It anticipates capital expenditures between $140 million and $160 million.
Currently, Stericycle carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot of Peers
Republic Services, Inc. (RSG - Free Report) reported an impressive fourth-quarter 2023 results.
RSG’s EPS, excluding 2 cents from non-recurring items, of $1.41 beat the Zacks Consensus Estimate by 10.2% and increased 24.8% year over year. Revenues of $3.8 billion surpassed the consensus mark by 2.9% and increased 8.6% year over year.
Envestnet, Inc. (ENV - Free Report) reported impressive fourth-quarter 2023.
ENV’s EPS, excluding $4 from non-recurring items, were 65 cents, surpassing the consensus estimate by 22.6%. The bottom line increased 44.4% from the year-ago quarter. Total revenues of $317.6 million beat the consensus estimate by 1.7%. The top line improved 8.5% on a year-over-year basis.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>
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