Clean Harbors Focuses On Boosting Efficiency To Reduce Risks
Zacks Investment Research | Sep 11, 2017 10:05PM ET
On Sep 12, we issued an updated research report on waste management services provider, Clean Harbors, Inc. (NYSE:CLH) .
Clean Harbors is currently focusing on improving efficiency and lowering operating costs through enhanced technology, process efficiencies and stringent cost management. The company has a competitive advantage around the treatment, storage and disposal facility (TSDF). Hence, by setting-up additional service locations near TSDFs, it expects to minimize capital expenditures and increase its market share within the Industrial and Field Services segment. This, in turn, will increase capacity utilization and improve overall profitability.
With several facilities on the Texas gulf coast, Clean Harbors provides a broad range of services such as end-to-end hazardous waste management, emergency spill response, industrial cleaning and maintenance, and recycling services. The company has earned a name for itself as a leading emergency response firm through dedicated staff and integrated facilities. Consequently, it is expected to leverage its expansive infrastructure, specialized equipment, capital base and customer relationships to help rebuild Texas that was ravaged by Hurricane Harvey.
At the same time, 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. The company is currently concentrating on strategic acquisitions to expand its business in the oil collection and refinery markets. Expansion of the existing services portfolio, especially in non-disposal services, is expected to generate incremental revenues in the future.
However, volatility in fuel prices and new environmental policies are rapidly transforming the American energy sector, while escalating wars in the Middle East and a nuclear deal with Iran are clouding the global oil picture. The company’s exploration, drilling activity and production are largely dependent upon the operation of oil rigs, as well as the global and North American oil prices. Oil price instability and price uncertainties have resulted in lower activity levels, which are negatively impacting the business. Clean Harbors has underperformed the Zacks Investment Research
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