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Stericycle Inc SRCL

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Stock XNAS Rating as of
$60.90 −0.15 (0.25%)
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As of Delayed Price Closed

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Stericycle: Acquisition by Waste Management Could Close in Q4 as Key Regulatory Hurdle Cleared

Brian Bernard

Shares of narrow-moat-rated Stericycle rose more than 4% in Sept. 6 intraday trading, nearing Waste Management’s $62 per share acquisition bid, after Stericycle announced that the 30-day waiting period associated with the Hart-Scott-Rodino Act (that is, US antitrust legislation) had expired. Stericycle said the acquisition has already cleared regulatory hurdles in Portugal and the UK but awaits approval in Canada and Spain. Management continues to expect the acquisition to close as early as the fourth quarter. See our June 3 analyst notes for Stericycle and WM for more details on this deal.

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Price vs Fair Value

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SRCL is trading at a 228% premium.
Price
$60.90
Fair Value
$84.00
Uncertainty
Medium
1-Star Price
$94.90
5-Star Price
$32.40
Economic Moat
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Capital Allocation
Csfwqyy

Bulls Say, Bears Say

Bulls

If Stericycle's turnaround efforts are successful, they will materially improve profitability and free cash flow.

Bears

Stericycle's Shred-It is a no-moat business in secular decline. This ill-advised 2015 acquisition could haunt the current management team and prevent the firm from realizing its long-term financial goals.

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News

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Trading Information

Previous Close Price
$61.05
Day Range
$60.85–61.09
52-Week Range
$37.78–61.77
Bid/Ask
$60.59 / $61.27
Market Cap
$5.65 Bil
Volume/Avg
3.2 Mil / 1.5 Mil

Key Statistics

Price/Earnings (Normalized)
30.14
Price/Sales
2.15
Dividend Yield (Trailing)
0.00%
Dividend Yield (Forward)
0.00%
Total Yield
0.11%

Company Profile

Stericycle is the largest provider of medical waste disposal and data destruction (primarily paper shredding) services in the United States. Its next-closest national competitor in medical waste disposal is Sharps Compliance, which generated $76 million of sales in fiscal 2021 before its 2022 acquisition (about 4% of Stericycle's global regulated waste and compliance revenue). Stericycle's data destruction business, Shred-It, is about twice the size of its closest competitor (Iron Mountain's information destruction segment). Stericycle has a global presence, with about 20% of its revenue earned outside North America.
Sector
Industrials
Industry
Waste Management
Stock Style Box
Small Core
Total Number of Employees
13,500
Website
https://www.stericycle.com

Competitors

Valuation

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Metric
SRCL
WCN
RSG
Price/Earnings (Normalized)
 30.1439.1433.41
Price/Book Value
 2.235.775.73
Price/Sales
 2.155.484.07
Price/Cash Flow
 20.8020.1916.20
Price/Earnings
SRCL
WCN
RSG

Financial Strength

Metric
SRCL
WCN
RSG
Quick Ratio
 1.020.590.54
Current Ratio
 1.130.700.59
Interest Coverage
 1.794.635.45
Quick Ratio
SRCL
WCN
RSG

Profitability

Metric
SRCL
WCN
RSG
Return on Assets (Normalized)
 1.05%6.44%6.15%
Return on Equity (Normalized)
 2.23%15.29%17.97%
Return on Invested Capital (Normalized)
 2.34%9.27%9.93%
Return on Assets
SRCL
WCN
RSG

Waste Management Industry Comparables

Screen With Investor
1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
Waste Management Inc
WM
YxrrhnfkvLbh$82.4 Bil
 Republic Services Inc
RSG
QpndmjpcMlhd$63.1 Bil
 Waste Connections Inc
WCN
TllddfnsSdz$46.1 Bil
 Veolia Environnement SA
VEOEF
—Gcycrf$24.3 Bil
 Veolia Environnement SA ADR
VEOEY
LzxmtsycKylmyj$24.3 Bil
 GFL Environmental Inc
GFL
—Pjlxys$15.5 Bil
 Clean Harbors Inc
CLH
TysyltbJjqrfzv$13.1 Bil
 Casella Waste Systems Inc Class A
CWST
—Zcgrbr$6.2 Bil
 Cleanaway Waste Management Ltd
TSPCF
—Bklw$4.5 Bil

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