Novo Nordisk, Eli Lilly fall after Trump comments on weight loss drug pricing
Investing.com - Barclays initiated coverage on Casella Waste Systems (NASDAQ:CWST) Thursday with an Underweight rating and a price target of $88.00, citing concerns about the waste management company’s geographic expansion efforts. The company, currently valued at $5.6 billion, is trading near its 52-week low of $87.36, with shares down about 17% year-to-date.
The research firm expressed concern that the market may be underestimating potential challenges related to Casella’s ongoing push to expand operations beyond its core Northeast market, which could raise integration risks and limit margin expansion in the medium term. According to InvestingPro data, eight analysts have recently revised their earnings expectations downward for the upcoming period, despite the company’s strong revenue growth of 20% in the last twelve months.
Barclays’ 2026/2027 adjusted EBITDA estimates for Casella are approximately 4% below Bloomberg consensus, despite including $100 million in annual incremental M&A spending in their model.
The $88 price target is based on a 14.5x multiple applied to cumulative third quarter 2026 through second quarter 2027 estimated adjusted EBITDA, less net debt.
While acknowledging Casella is building a strong growth platform with significant M&A upside potential in the long term, Barclays believes the company’s still-elevated valuations combined with near-term integration challenges present modest potential downside to shares.
In other recent news, Casella Waste Systems reported its Q2 2025 earnings, which showed a significant shortfall in earnings per share (EPS) compared to projections, despite surpassing revenue expectations. The company’s EPS was $0.08, considerably below the anticipated $0.33, marking a surprise of -75.76%. However, revenue reached $465.3 million, exceeding the forecast of $454.35 million. Additionally, Jefferies adjusted its price target for Casella Waste Systems to $115.11 from $118.00, maintaining a Hold rating due to concerns about the company’s margin performance. This adjustment came after what Jefferies described as a "mixed quarter" for the company. In leadership news, Casella Waste Systems announced that John W. Casella will transition from CEO to Executive Chairman of the Board effective January 1, 2026. Edmond "Ned" Coletta, the current President, will succeed him as CEO. These developments reflect ongoing changes and challenges within the company.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.