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Stericycle Inc SRCL

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Stock XNAS Rating as of
$50.94 +1.03 (2.06%)
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As of Delayed Price Closed
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Company Report

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Stericycle Is on a Path for Strong Margin Expansion

Brian Bernard

Since its founding in 1989, Stericycle had been extremely acquisitive, having purchased more than 500 companies. This strategy led to a lengthy period of impressive growth, and the firm built unmatched scale. However, acquisitions began to stray from Stericycle's core competencies, and poor integration efforts caused inefficiencies to build. After decades of strong growth and profitability, Stericycle's financial performance began to deteriorate in 2017.

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Price vs Fair Value

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SRCL is trading at a 15% discount.
Price
$50.94
Fair Value
$65.00
Uncertainty
Medium
1-Star Price
$53.00
5-Star Price
$92.00
Economic Moat
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Capital Allocation
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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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Trading Information

Previous Close Price
$49.91
Day Range
$49.90–51.17
52-Week Range
$37.78–57.06
Bid/Ask
$20.38 / $81.50
Market Cap
$4.73 Bil
Volume/Avg
514,819 / 474,978

Key Statistics

Price/Earnings (Normalized)
26.13
Price/Sales
1.70
Dividend Yield (Trailing)
—
Dividend Yield (Forward)
—
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
RSG
WCN
Price/Earnings (Normalized)
 26.1334.2439.22
Price/Book Value
 1.795.725.50
Price/Sales
 1.704.065.29
Price/Cash Flow
 15.0616.9020.07
Price/Earnings
SRCL
RSG
WCN

Financial Strength

Metric
SRCL
RSG
WCN
Quick Ratio
 0.820.500.57
Current Ratio
 0.940.560.68
Interest Coverage
 1.045.304.55
Quick Ratio
SRCL
RSG
WCN

Profitability

Metric
SRCL
RSG
WCN
Return on Assets (Normalized)
 3.31%5.94%6.19%
Return on Equity (Normalized)
 7.09%17.51%14.58%
Return on Invested Capital (Normalized)
 5.42%9.64%8.89%
Return on Assets
SRCL
RSG
WCN
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