Clean Harbors Poised To Gain From Strategic Investments
Zacks Investment Research | Mar 04, 2018 09:44PM ET
On Mar 05, we updated the research report on waste management firm, Clean Harbors, Inc. (NYSE:CLH) .
The company is currently focused on enhancing its operating margins through better pricing policies, improving revenue mix, increasing efficiencies and capitalizing on growth initiatives, which are likely to aid its long-term growth potential. It is also expanding its existing services portfolio, especially in non-disposal services, with a view to generate incremental revenues in the future.
Healthy Growth Dynamics
In fourth-quarter 2017, Clean Harbors completed the acquisition of Veolia North America’s U.S. Industrial Cleaning Services Division for $120 million in an all-cash transaction, subject to customary post-closing adjustments. For 2017, the acquired company generated revenues of approximately $210 million. It employs roughly 1,300 employees and maintains an extensive fleet of vehicles and equipment at more than 60 operating locations across the United States.
The acquisition is likely to deliver numerous benefits to Clean Harbors’ customers, shareholders and industrial services employees. Likewise, this gives a scope for significant scale and industrial service capabilities while more than doubling the size of its existing U.S. Industrial Services business. The acquired business’ operational footprint, particularly its strong presence in the Midwest, complements Clean Harbors’ existing network of locations. The addition of this business will create new cross-selling opportunities and drive incremental volumes into Clean Harbors’ waste disposal network. This transaction is expected to enhance Clean Harbors’ long-term shareholder’s value and lead to healthy return on investments in 2018 and after.
Clean Harbors is focusing on improving its 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 facilities.
In addition, Clean Harbors continues to generate significant free cash flow, which is utilized for increased dividend payments and strategic acquisitions. The company has also historically promulgated a conservative balance sheet with a healthy liquidity position. The stock has, however, underperformed the Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.