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Clean Harbors (CLH) Up 4.3% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Clean Harbors (CLH - Free Report) . Shares have added about 4.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Clean Harbors due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Clean Harbors' Q3 Earnings Miss Estimates
Clean Harbors, Inc. reported disappointing third-quarter 2023 results, wherein earnings and revenues missed the Zacks Consensus Estimate.
The investors, however, seem to be unaffected by such earnings miss as the stock rose 4.9% since the earnings release on Nov 1.
Adjusted earnings per share of $1.68 missed the Zacks Consensus Estimate by 18.8% and declined from the year-ago quarter’s figure by 30.9%. Total revenues of $1.37 billion missed the consensus estimate by 2.1% but grew slightly on a year-over-year basis.
Let’s check out the numbers in detail.
Revenues by Segment
Environmental Services’ (ES) revenues of $1.15 billion grew 5.5% year over year, surpassing our estimated $1.11 billion. The uptick was backed by higher volumes of high-value waste streams, pricing initiatives and strength in its Industrial Services businesses.
Safety-Kleen Sustainability Solutions’ (SKSS) revenues of $219.2 million declined 20.7% year over year, missing our estimated $271.6 million.
Profitability Performance
Adjusted EBITDA of $255 million decreased 17.4% year over year and missed our estimated $277.8 million. The adjusted EBITDA margin declined to 18.7% from 22.6% in the year-ago quarter.
Segment-wise, ES’ adjusted EBITDA was $288.98 million, up 10.9% year over year. SKSS’ adjusted EBITDA was $31.16 million, down 69.8% year over year.
Balance Sheet & Cash Flow
Clean Harbors exited third-quarter 2023 with cash and cash equivalents of $336 million compared with $238.8 million at the end of the prior quarter. Inventories and supplies were $311.5 million compared with $325.9 million in the prior quarter. Long-term debt was $2.29 billion, flat compared with the prior quarter’s figure.
CLH generated $220.12 million in net cash from operating activities in the reported quarter. Capital expenditure was $107.61 million. Adjusted free cash flow was $114.7 million.
Guidance
For 2023, adjusted EBITDA is anticipated to be between $1.01 billion and $1.03 billion.
Adjusted free cash flow for the current year is expected between $300 million and $330 million. Net cash from operating activities is projected in the range of $700-$750 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
At this time, Clean Harbors has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Clean Harbors has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Clean Harbors belongs to the Zacks Waste Removal Services industry. Another stock from the same industry, Waste Connections (WCN - Free Report) , has gained 2% over the past month. More than a month has passed since the company reported results for the quarter ended September 2023.
Waste Connections reported revenues of $2.06 billion in the last reported quarter, representing a year-over-year change of +9.8%. EPS of $1.17 for the same period compares with $1.10 a year ago.
For the current quarter, Waste Connections is expected to post earnings of $1.08 per share, indicating a change of +21.4% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.3% over the last 30 days.
Waste Connections has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.
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Clean Harbors (CLH) Up 4.3% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Clean Harbors (CLH - Free Report) . Shares have added about 4.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Clean Harbors due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Clean Harbors' Q3 Earnings Miss Estimates
Clean Harbors, Inc. reported disappointing third-quarter 2023 results, wherein earnings and revenues missed the Zacks Consensus Estimate.
The investors, however, seem to be unaffected by such earnings miss as the stock rose 4.9% since the earnings release on Nov 1.
Adjusted earnings per share of $1.68 missed the Zacks Consensus Estimate by 18.8% and declined from the year-ago quarter’s figure by 30.9%. Total revenues of $1.37 billion missed the consensus estimate by 2.1% but grew slightly on a year-over-year basis.
Let’s check out the numbers in detail.
Revenues by Segment
Environmental Services’ (ES) revenues of $1.15 billion grew 5.5% year over year, surpassing our estimated $1.11 billion. The uptick was backed by higher volumes of high-value waste streams, pricing initiatives and strength in its Industrial Services businesses.
Safety-Kleen Sustainability Solutions’ (SKSS) revenues of $219.2 million declined 20.7% year over year, missing our estimated $271.6 million.
Profitability Performance
Adjusted EBITDA of $255 million decreased 17.4% year over year and missed our estimated $277.8 million. The adjusted EBITDA margin declined to 18.7% from 22.6% in the year-ago quarter.
Segment-wise, ES’ adjusted EBITDA was $288.98 million, up 10.9% year over year. SKSS’ adjusted EBITDA was $31.16 million, down 69.8% year over year.
Balance Sheet & Cash Flow
Clean Harbors exited third-quarter 2023 with cash and cash equivalents of $336 million compared with $238.8 million at the end of the prior quarter. Inventories and supplies were $311.5 million compared with $325.9 million in the prior quarter. Long-term debt was $2.29 billion, flat compared with the prior quarter’s figure.
CLH generated $220.12 million in net cash from operating activities in the reported quarter. Capital expenditure was $107.61 million. Adjusted free cash flow was $114.7 million.
Guidance
For 2023, adjusted EBITDA is anticipated to be between $1.01 billion and $1.03 billion.
Adjusted free cash flow for the current year is expected between $300 million and $330 million. Net cash from operating activities is projected in the range of $700-$750 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
At this time, Clean Harbors has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Clean Harbors has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Clean Harbors belongs to the Zacks Waste Removal Services industry. Another stock from the same industry, Waste Connections (WCN - Free Report) , has gained 2% over the past month. More than a month has passed since the company reported results for the quarter ended September 2023.
Waste Connections reported revenues of $2.06 billion in the last reported quarter, representing a year-over-year change of +9.8%. EPS of $1.17 for the same period compares with $1.10 a year ago.
For the current quarter, Waste Connections is expected to post earnings of $1.08 per share, indicating a change of +21.4% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.3% over the last 30 days.
Waste Connections has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.