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Stericycle (SRCL) Stock Rises 10% in 6 Months: Here's How

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Stericycle, Inc. (SRCL - Free Report) shares have had an impressive run in the past six months. The stock has gained 9.7% compared with the 9.9% rally of the Zacks S&P 500 composite.

Reasons for the Upside

The services that Stericycle provides usually cannot be delayed and are required on a scheduled basis, allowing the company to achieve a steady flow of revenues. It has strong customer relationships, most of which include long-term contracts ranging from three to five years. This enables it to maintain a revenue retention rate of around 90%.

Stericycle has progressed well with its key objectives of the program, including improving the quality of revenues; driving operational efficiency through work measurement, asset optimization, technology, strategic sourcing; portfolio rationalization through divestitures; debt reduction and leverage improvement; and ERP implementation.

The company is likely to benefit from ongoing trends such as increasing environmental concerns, rapid industrialization, increase in population and active government measures to reduce illegal dumping.

Zacks Rank and Stocks to Consider

Stericycle currently carries a Zacks Rank #3 (Hold).

Here are some better-ranked stocks from the broader Business Service sector, which you may consider.

Verisk Analytics (VRSK - Free Report) beat the Zacks Consensus Estimate in three of the four previous quarters and matched on one instance, with an average surprise of 9.9%. The consensus mark for 2023 revenues is pegged at $2.66 billion, which reflects a decrease of 8.2% from the year-ago figure. Earnings are pegged at $5.71 per share for 2023, which is 14% above the year-ago figure. VRSK currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Automatic Data (ADP - Free Report) presently has a Zacks Rank of 2. The company beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 3.1%. The consensus estimate for fiscal 2024 revenues and earnings implies growth of 6.3% and 11.1% year over year, respectively.

Broadridge (BR - Free Report) currently carries a Zacks Rank of 2. It beat the Zacks Consensus Estimate in two of the trailing four quarters, missed once and matched on one instance, the average surprise being 0.5%. The consensus estimate for fiscal 2024 revenues and earnings indicates a rise of 7.2% and 8.8% year over year, respectively.

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