In a report published Monday, Credit Suisse analyst Hamzah Mazari initiated coverage on Stericycle, Inc. SRCL at Outperform, establishing a $140.00 price target.
According to the report, the $140.00 price target is based on the analyst's normalized EBIDTA
estimate of ~$920mm at ~16.5x multiple discounted back.
“Barrier to entry in the medical waste business is not just having a disposal network advantage but also high route density similar to the municipal solid waste business,” the report noted. “We believe having captive US market share in a stable business (over 95% of revenues are under long term contracts with automatic renewal clauses) with significant global and domestic secular drivers insulates Stericycle from economic cycles.”
Some highlights from the report included:
-Mix and Cross Selling is Underappreciated.
-International Markets Remain Upside.
SRCL closed Friday at 115.42.
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