Here's Why You Should Hold Stericycle (SRCL) Stock for Now
Stericycle, Inc. SRCL has had an impressive run over the past three months, gaining 6%.
The company is currently benefiting from the essentiality of its services and strong customer relationships. It has an expected long-term earnings per share (three to five years) growth rate of 8%.
Stericycle, Inc. Price
Stericycle, Inc. price | Stericycle, Inc. Quote
Factors That Augur Well
Stericycle continues to focus on improving the quality of revenues, driving operational efficiency through modernization and innovation, portfolio optimization, debt reduction and leverage improvement and ERP implementation.
Being a leading player in the waste management industry, Stericycle 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.
The services that Stericycle provides cannot usually be delayed and are required on a routine and scheduled basis. This helps the company to achieve a steady flow of revenues. It has strong customer relationships, boasting long-term contracts ranging from three to five years.
Hurdles to Counter
SRCL has more long-term debt outstanding than cash. Cash and cash equivalent balance at the end of first-quarter 2023 was $60 million compared with the long-term debt level of $1.5 billion. In the last reported quarter, the company’s performance was negatively impacted by higher supply chain, labor and other inflationary costs.
Zacks Rank and Stocks to Consider
Stericycle currently carries a Zacks Rank #3 (Hold).
Investors interested in the broader Zacks Business Services can consider the following better-ranked stocks.
Green Dot GDOT: For second-quarter 2023, the Zacks Consensus Estimate for Green Dot’s revenues suggests a decline of 4.8% year over year to $338.2 million and the same for earnings indicates a 59.5% plunge to 30 cents per share. The company has an impressive earnings surprise history, beating the consensus mark in all the trailing four quarters, the average surprise being 37.3%.
GDOT has a Value Score of A and currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Maximus MMS: For second-quarter 2023, the Zacks Consensus Estimate for Maximus’ revenues suggests an increase of 6.9% year over year to $1.2 billion and the same for earnings indicates a 46.2% rise to $1.14 per share. The company has an impressive earnings surprise history, beating the consensus mark in three instances and missing once, the average surprise being 9.6%.
MMS has a VGM Score of A and sports a Zacks Rank of 1.
Rollins ROL: For second-quarter 2023, the Zacks Consensus Estimate for Rollins’ revenues suggests growth of 12.6% year over year to $803.6 million and the same for earnings indicates a 15% increase to 23 cents per share. The company has an impressive earning surprise history, beating the consensus mark in three of the four trailing quarters and missing once, the average surprise being 5.53%.
ROL currently carries a Zacks Rank of 2.
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Stericycle, Inc. (SRCL) : Free Stock Analysis Report
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