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Unpacking Q1 Earnings: Tetra Tech (NASDAQ:TTEK) In The Context Of Other Environmental and Facilities Services Stocks


Petr Huřťák /
2024/07/04 9:01 am EDT

Earnings results often indicate what direction a company will take in the months ahead. With Q1 now behind us, let’s have a look at Tetra Tech (NASDAQ:TTEK) and its peers.

Many environmental and facility services are non-discretionary (sports stadiums need to be cleaned after events), recurring, and performed through longer-term contracts. This makes for more predictable and stickier revenue streams. Additionally, there has been an increasing focus on emissions and water conservation over the last decade, driving innovation in the sector and demand for new services. Despite these tailwinds, environmental and facility services companies are still at the whim of economic cycles. Interest rates, for example, can greatly impact commercial construction projects that drive incremental demand for these services.

The 8 environmental and facilities services stocks we track reported a decent Q1; on average, revenues beat analyst consensus estimates by 0.6%. while next quarter's revenue guidance was 0.6% above consensus. Stocks--especially those trading at higher multiples--had a strong end of 2023, but 2024 has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts, but environmental and facilities services stocks have shown resilience, with share prices up 8.6% on average since the previous earnings results.

Tetra Tech (NASDAQ:TTEK)

Originally founded to focus on Alaska’s oil pipelines, Tetra Tech (NASDAQ:TTEK) provides consulting and engineering services to the water and infrastructure industries.

Tetra Tech reported revenues of $1.05 billion, up 8.6% year on year, topping analysts' expectations by 2.7%. It was a mixed quarter for the company, with a decent beat of analysts' earnings estimates but a miss of analysts' backlog sales estimates.

Tetra Tech Total Revenue

Tetra Tech scored the highest full-year guidance raise of the whole group. The stock is up 5.7% since the results and currently trades at $203.5.

Is now the time to buy Tetra Tech? Access our full analysis of the earnings results here, it's free.

Best Q1: Clean Harbors (NYSE:CLH)

Having played a role in the cleanup of many historical oil spills, Clean Harbors (NYSE:CLH) provides environmental services like hazardous and non-hazardous waste disposal.

Clean Harbors reported revenues of $1.38 billion, up 5.3% year on year, outperforming analysts' expectations by 3%. It was a very strong quarter for the company, with a solid beat of analysts' organic revenue estimates and a decent beat of analysts' earnings estimates.

Clean Harbors Total Revenue

Clean Harbors achieved the biggest analyst estimates beat among its peers. The stock is up 18.3% since the results and currently trades at $224.31.

Is now the time to buy Clean Harbors? Access our full analysis of the earnings results here, it's free.

Weakest Q1: Stericycle (NASDAQ:SRCL)

Having completed 500 acquisitions since its inception, Stericycle (NASDAQ:SRCL) provides waste disposal and sensitive information destruction services.

Stericycle reported revenues of $664.9 million, down 2.8% year on year, falling short of analysts' expectations by 1.7%. It was a weak quarter for the company, with a miss of analysts' organic revenue estimates.

Stericycle had the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is up 17.1% since the results and currently trades at $58.41.

Read our full analysis of Stericycle's results here.

Waste Management (NYSE:WM)

Founded in 1968, Waste Management (NYSE:WM) specializes in waste collection, disposal, recycling, and environmental services across North America.

Waste Management reported revenues of $5.16 billion, up 5.5% year on year, falling short of analysts' expectations by 1.2%. It was an ok quarter for the company, with a solid beat of analysts' earnings estimates.

The stock is down 0.1% since the results and currently trades at $210.2.

Read our full, actionable report on Waste Management here, it's free.

Rollins (NYSE:ROL)

Operating under multiple brands like Orkin and HomeTeam Pest Defense, Rollins (NYSE:ROL) provides pest and wildlife control services to residential and commercial customers.

Rollins reported revenues of $748.3 million, up 13.7% year on year, surpassing analysts' expectations by 1.2%. It was a very strong quarter for the company, with an impressive beat of analysts' organic revenue estimates and a narrow beat of analysts' earnings estimates .

The stock is up 17.2% since the results and currently trades at $50.29.

Read our full, actionable report on Rollins here, it's free.

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