Advanced Disposal Services (NYSE: ADSW) and Stericycle (NASDAQ:SRCL) are both mid-cap business services companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, earnings, valuation, risk and dividends.
This table compares Advanced Disposal Services and Stericycle’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Advanced Disposal Services||-1.61%||5.84%||1.41%|
92.6% of Stericycle shares are owned by institutional investors. 1.2% of Advanced Disposal Services shares are owned by insiders. Comparatively, 3.5% of Stericycle shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Risk & Volatility
Advanced Disposal Services has a beta of -0.35, indicating that its share price is 135% less volatile than the S&P 500. Comparatively, Stericycle has a beta of 0.26, indicating that its share price is 74% less volatile than the S&P 500.
This is a breakdown of recent ratings and target prices for Advanced Disposal Services and Stericycle, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Advanced Disposal Services||0||2||6||0||2.75|
Advanced Disposal Services currently has a consensus target price of $26.00, indicating a potential upside of 10.12%. Stericycle has a consensus target price of $72.44, indicating a potential downside of 3.69%. Given Advanced Disposal Services’ stronger consensus rating and higher probable upside, research analysts plainly believe Advanced Disposal Services is more favorable than Stericycle.
Earnings and Valuation
This table compares Advanced Disposal Services and Stericycle’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Advanced Disposal Services||$1.40 billion||1.49||-$30.40 million||($0.28)||-84.32|
|Stericycle||$3.56 billion||1.80||$206.35 million||($0.56)||-134.32|
Stericycle has higher revenue and earnings than Advanced Disposal Services. Stericycle is trading at a lower price-to-earnings ratio than Advanced Disposal Services, indicating that it is currently the more affordable of the two stocks.
Stericycle beats Advanced Disposal Services on 8 of the 14 factors compared between the two stocks.
About Advanced Disposal Services
Advanced Disposal Services, Inc. is an integrated provider of non-hazardous solid waste collection, transfer, recycling and disposal services operating primarily in secondary markets or under exclusive arrangements. The Company’s segments include South, East, Midwest and Corporate. As of December 31, 2016, the Company had its presence in 16 states across the Midwest, South and East regions of the United States, as well as in the Commonwealth of the Bahamas, served approximately 2.7 million residential customers and over 200,000 commercial and industrial (C&I) customers through its network of 90 collection operations, 72 transfer stations, 21 owned or operated recycling facilities and 39 owned or operated active landfills. The Company’s vertically integrated environmental services operations can be classified into three lines of business: collection services, disposal services and recycling services. The disposal services include transfer stations and landfills.
Stericycle, Inc. is a business-to-business services provider. The Company focuses on regulated and compliance solutions for healthcare, retail, and commercial businesses. The Company’s segments include Domestic and Canada Regulated Waste and Compliance Services (RCS), Domestic Communication and Related Services (CRS), International RCS and All other. The Domestic and Canada RCS and International RCS segments include medical waste disposal, pharmaceutical waste disposal, hazardous waste management, sustainability solutions for expired or unused inventory, secure information destruction of documents and e-media, training and consulting through its Steri-Safe and Clinical Services programs, and other regulatory compliance services. The Domestic CRS segment consists of inbound/outbound communication, automated patient reminders, online scheduling, notifications, product retrievals, product returns and quality audits.
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