Clean Harbors, Inc. (NYSE:CLH) Just Reported And Analysts Have Been Lifting Their Price Targets

Last week saw the newest yearly earnings release from Clean Harbors, Inc. (NYSE:CLH), an important milestone in the company's journey to build a stronger business. Clean Harbors reported in line with analyst predictions, delivering revenues of US$5.4b and statutory earnings per share of US$6.95, suggesting the business is executing well and in line with its plan. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Clean Harbors

After the latest results, the 13 analysts covering Clean Harbors are now predicting revenues of US$5.64b in 2024. If met, this would reflect a modest 4.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 6.8% to US$7.48. In the lead-up to this report, the analysts had been modelling revenues of US$5.69b and earnings per share (EPS) of US$7.95 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

Despite cutting their earnings forecasts,the analysts have lifted their price target 5.8% to US$198, suggesting that these impacts are not expected to weigh on the stock's value in the long term. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Clean Harbors at US$213 per share, while the most bearish prices it at US$175. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Clean Harbors is an easy business to forecast or the the analysts are all using similar assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Clean Harbors' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 4.4% growth on an annualised basis. This is compared to a historical growth rate of 13% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.5% per year. Factoring in the forecast slowdown in growth, it seems obvious that Clean Harbors is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Clean Harbors analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that Clean Harbors is showing 2 warning signs in our investment analysis , you should know about...

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