Casella Waste Systems Dives On Its Big Capital Raise (Rating Upgrade)
Summary
- Casella Waste Systems, Inc.'s stock dropped over 5% due to a sizable new share offering to fund acquisitions and reduce debt, causing market displeasure over dilution.
- Despite the market's reaction, I view the share issuance positively, as it allows for accretive acquisitions and debt reduction, upgrading my rating to 'hold'.
- The acquisition of Royal Carting and Welsh Sanitation aims to boost revenue and expand service territory, with the purchase price estimated by the author at $243.4 million.
- Casella's growth is driven by acquisitions, with 2024 revenue expected to grow materially to between $1.52 and $1.55 billion.
Yevhen Smyk
September 18th was a difficult day for shareholders of solid waste services company Casella Waste Systems, Inc. (NASDAQ:CWST). The stock dropped over 5% after details came out about a rather sizable offering of new
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