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Why Clean Harbors (CLH) is an Attractive Stock for Investors
Zacks Equity Research
Mon, December 19, 2022 at 1:50 PM GMT+1
In this article:
Clean Harbors, Inc. CLH has performed well in the past year and shown the potential to sustain the momentum. If you haven’t taken advantage of its share price appreciation yet, it’s time you add the stock to your portfolio.
Let’s look at the factors that make the stock an attractive pick.
An Outperformer: Shares of CLH have gained 24.1% in the past year against the 8.2% fall of the industry it belongs to.
Solid Rank & VGM Score: Clean Harbors currently has a Zacks Rank #2 (Buy) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities. Thus, CLH seems to be an appropriate investment proposition at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here.
Positive Earnings Surprise History: Clean Harbors has an impressive earnings surprise history. CLH’s bottom line outpaced the Zacks Consensus Estimate in all the trailing four quarters, the average being 38.2%.
Strong Prospects: The Zacks Consensus Estimate for 2022 earnings is pegged at $7.26 per share, indicating growth of 99.5% from the year-ago reported figure.
Key Driving Factors: We are impressed with Clean Harbors’ consistent record of returning value to shareholders in the form of share repurchases. These initiatives not only instill investors’ confidence but also positively impact earnings per share.
In 2021, 2020 and 2019, the company had repurchased shares worth $54.4 million, $74.8 million and $21.4 million, respectively. Such moves indicate the company’s commitment to create value for shareholders and underline its confidence in its business.
Clean Harbors continues to make capital investments to enhance its quality and comply with government and local regulations. The current regulatory requirements are cost intensive and complicated for in-house disposal facilities, which in turn compel most companies to outsource their hazardous waste disposal needs. This is where Clean Harbors steps in with its suitable disposal firms in Canada and the United States.
Moreover, Clean Harbors has a diversified customer base ranging from Fortune 500 companies to midsize and small public and private entities. This provides the company with stable and recurring sources of revenues.
The company has comprehensive waste disposal and waste tracking capabilities. Hence it has been chosen as an authorized vendor by large and small generators of waste. |
