Environmental services provider Montrose (NYSE:MEG) will be reporting earnings tomorrow after market hours. Here’s what you need to know.
Montrose missed analysts’ revenue expectations by 3.7% last quarter, reporting revenues of $178.7 million, up 6.4% year on year. It was a mixed quarter for the company, with a solid beat of analysts’ adjusted operating income estimates but a significant miss of analysts’ organic revenue estimates.
Is Montrose a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Montrose’s revenue to grow 13.3% year on year to $187.8 million, slowing from the 18.8% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.14 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Montrose has missed Wall Street’s revenue estimates six times over the last two years.
Looking at Montrose’s peers in the waste management segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Casella Waste Systems delivered year-on-year revenue growth of 18.9%, beating analysts’ expectations by 2.3%, and Republic Services reported revenues up 5.6%, falling short of estimates by 0.7%. Casella Waste Systems’s stock price was unchanged after the results, while Republic Services was up 3%.
Read our full analysis of Casella Waste Systems’s results here and Republic Services’s results here.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump's triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the waste management stocks have shown solid performance, the group has generally underperformed, with share prices down 7.6% on average over the last month. Montrose is down 17.2% during the same time and is heading into earnings with an average analyst price target of $34.67 (compared to the current share price of $18.91).
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