Casella Waste Systems (NASDAQ: CWST) and Advanced Disposal Services (NASDAQ:ADSW) are both industrial products companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, dividends, risk, profitability, institutional ownership and earnings.

Insider & Institutional Ownership

77.4% of Casella Waste Systems shares are owned by institutional investors. 11.5% of Casella Waste Systems shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Casella Waste Systems and Advanced Disposal Services’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Casella Waste Systems -10.01% -60.26% 3.31%
Advanced Disposal Services -0.05% -0.10% -0.02%

Valuation and Earnings

This table compares Casella Waste Systems and Advanced Disposal Services’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Casella Waste Systems $582.75 million 1.28 $112.99 million ($1.40) -12.64
Advanced Disposal Services $1.44 billion 1.50 $394.80 million N/A N/A

Advanced Disposal Services has higher revenue and earnings than Casella Waste Systems.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Casella Waste Systems and Advanced Disposal Services, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Casella Waste Systems 0 2 3 0 2.60
Advanced Disposal Services 0 2 8 0 2.80

Casella Waste Systems currently has a consensus price target of $16.60, suggesting a potential downside of 6.16%. Advanced Disposal Services has a consensus price target of $25.22, suggesting a potential upside of 3.45%. Given Advanced Disposal Services’ stronger consensus rating and higher possible upside, analysts plainly believe Advanced Disposal Services is more favorable than Casella Waste Systems.

Summary

Advanced Disposal Services beats Casella Waste Systems on 8 of the 11 factors compared between the two stocks.

Casella Waste Systems Company Profile

Casella Waste Systems, Inc. is a solid waste services company. The Company provides resource management services to residential, commercial, municipal and industrial customers, primarily in the areas of solid waste collection and disposal, transfer, recycling and organics services. It manages its solid waste operations on a geographic basis through two regional operating segments: Eastern and Western regions, each of which provides a range of solid waste services, and its recycling and commodity brokerage operations through its Recycling segment. Organics services, ancillary operations and industrial services are included in its Other segment. As of January 31, 2017, the Company owned and/or operated 32 solid waste collection operations, 46 transfer stations, 18 recycling facilities, nine Subtitle D landfills, four landfill gas-to-energy facilities and one landfill permitted to accept construction and demolition (C&D) materials.

Advanced Disposal Services Company Profile

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.

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