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Why Is Service Corp. (SCI) Up 3.4% Since Last Earnings Report?
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A month has gone by since the last earnings report for Service Corp. (SCI - Free Report) . Shares have added about 3.4% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Service Corp. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important catalysts.
Service Corp. Q2 Earnings & Revenues Beat Estimates
Service Corp. posted second-quarter 2025 results, with the top and bottom lines increasing year over year and beating the Zacks Consensus Estimate.
SCI posted adjusted earnings of 88 cents per share, which surpassed the Zacks Consensus Estimate of 84 cents. The metric increased from the year-ago quarter’s adjusted earnings of 79 cents.
Total revenues of $1,065.4 million increased 2.9% from $1,034 million in the year-ago quarter. The top line beat the Zacks Consensus Estimate of $1,050 million.
Gross profit increased 5% to $271.4 million from $257.9 million last year. We note that the gross margin expanded 60 basis points (bps) year over year to 25.5%. Corporate general and administrative expenses increased 26.9% year over year to $49.5 million. As a percentage of revenues, this metric grew 80 bps year over year to 4.6%. Operating income rose 1.7% to $224.5 million from $220.8 million in the year-ago period. The operating margin contracted 30 bps year over year to 21.1% in the quarter under review.
SCI Provides Insights by Segments
Funeral Operations: Total funeral revenues reached $591.4 million, faring better than the Zacks Consensus Estimate of $579 million. This compares with $565.8 million in the second quarter of 2024. Gross profit increased 15.5% to $116 million from $100.4 million. The gross margin expanded 190 bps year over year to 19.6%. The segment performed 87,074 funeral services compared with 86,031 in the prior-year quarter, with average revenues per service of $5,807 versus $5,636. Comparable funeral results showed that core revenues increased 3.6% to $479.6 million, driven by at-need revenue growth of 4.5% to $296.1 million and matured pre-need revenue growth of 2.7% to $183.5 million. Non-funeral home revenues increased 12.2% to $25.7 million, whereas core general agency and other revenues grew 15.3% to $59.7 million. Non-funeral home pre-need sales revenues decreased 9.3% to $26.4 million.
Cemetery Operations: Total cemetery revenues were $474.4 million, exceeding the consensus estimate of $471 million. This compares with $468.2 million in the second quarter of 2024. Gross profit was $155.5 million, down from $157.5 million seen in the year-ago quarter. The gross margin declined 80 bps year over year to 32.8%. Comparable cemetery results showed core revenues increasing 1% to $437.2 million, with total recognized preneed revenues up 0.3% year over year.
Service Corp’s Financial Health Snapshot
The company ended the quarter with cash and cash equivalents of $255.4 million, long-term debt of $4.98 billion, and total equity of $1.56 billion.
SCI’s 2025 Guidance
For 2025, adjusted earnings per share are still expected to be $3.70-$4.00. At the mid-point, this range is consistent with the company’s expected long-term growth framework of 8% to 12%. Net cash provided by operating activities, excluding special items and cash taxes, is now projected between $1,025 million and $1,085 million.
Based on the mid-point of the EPS guidance, cash taxes are anticipated to be $145 million. After accounting for these taxes, net cash provided by operating activities, excluding special items, is expected to be $880-$940 million. The total capital expenditure for 2025 is forecast at $315 million. This includes $130 million allocated to capital improvements at existing field locations, $160 million for the development of cemetery property, and $25 million for digital investments and corporate initiatives.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a flat trend in estimates revision.
VGM Scores
Currently, Service Corp. has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a score of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Service Corp. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Service Corp. (SCI) Up 3.4% Since Last Earnings Report?
A month has gone by since the last earnings report for Service Corp. (SCI - Free Report) . Shares have added about 3.4% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Service Corp. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important catalysts.
Service Corp. Q2 Earnings & Revenues Beat Estimates
Service Corp. posted second-quarter 2025 results, with the top and bottom lines increasing year over year and beating the Zacks Consensus Estimate.
SCI posted adjusted earnings of 88 cents per share, which surpassed the Zacks Consensus Estimate of 84 cents. The metric increased from the year-ago quarter’s adjusted earnings of 79 cents.
Total revenues of $1,065.4 million increased 2.9% from $1,034 million in the year-ago quarter. The top line beat the Zacks Consensus Estimate of $1,050 million.
Gross profit increased 5% to $271.4 million from $257.9 million last year. We note that the gross margin expanded 60 basis points (bps) year over year to 25.5%. Corporate general and administrative expenses increased 26.9% year over year to $49.5 million. As a percentage of revenues, this metric grew 80 bps year over year to 4.6%. Operating income rose 1.7% to $224.5 million from $220.8 million in the year-ago period. The operating margin contracted 30 bps year over year to 21.1% in the quarter under review.
SCI Provides Insights by Segments
Funeral Operations: Total funeral revenues reached $591.4 million, faring better than the Zacks Consensus Estimate of $579 million. This compares with $565.8 million in the second quarter of 2024. Gross profit increased 15.5% to $116 million from $100.4 million. The gross margin expanded 190 bps year over year to 19.6%. The segment performed 87,074 funeral services compared with 86,031 in the prior-year quarter, with average revenues per service of $5,807 versus $5,636. Comparable funeral results showed that core revenues increased 3.6% to $479.6 million, driven by at-need revenue growth of 4.5% to $296.1 million and matured pre-need revenue growth of 2.7% to $183.5 million. Non-funeral home revenues increased 12.2% to $25.7 million, whereas core general agency and other revenues grew 15.3% to $59.7 million. Non-funeral home pre-need sales revenues decreased 9.3% to $26.4 million.
Cemetery Operations: Total cemetery revenues were $474.4 million, exceeding the consensus estimate of $471 million. This compares with $468.2 million in the second quarter of 2024. Gross profit was $155.5 million, down from $157.5 million seen in the year-ago quarter. The gross margin declined 80 bps year over year to 32.8%. Comparable cemetery results showed core revenues increasing 1% to $437.2 million, with total recognized preneed revenues up 0.3% year over year.
Service Corp’s Financial Health Snapshot
The company ended the quarter with cash and cash equivalents of $255.4 million, long-term debt of $4.98 billion, and total equity of $1.56 billion.
SCI’s 2025 Guidance
For 2025, adjusted earnings per share are still expected to be $3.70-$4.00. At the mid-point, this range is consistent with the company’s expected long-term growth framework of 8% to 12%. Net cash provided by operating activities, excluding special items and cash taxes, is now projected between $1,025 million and $1,085 million.
Based on the mid-point of the EPS guidance, cash taxes are anticipated to be $145 million. After accounting for these taxes, net cash provided by operating activities, excluding special items, is expected to be $880-$940 million. The total capital expenditure for 2025 is forecast at $315 million. This includes $130 million allocated to capital improvements at existing field locations, $160 million for the development of cemetery property, and $25 million for digital investments and corporate initiatives.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a flat trend in estimates revision.
VGM Scores
Currently, Service Corp. has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a score of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Service Corp. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.