Barclays initiates GFL Environmental stock with Overweight rating

Investing.com - Barclays initiated coverage on GFL Environmental (NYSE:GFL) with an Overweight rating and a price target of $62.00 on Thursday. The waste management company, currently trading at $46.13 with a market capitalization of $16.8 billion, has shown strong momentum with a 19% revenue growth over the last twelve months.

The investment bank cited GFL’s potential for above-peer growth as a key factor in its rating decision, forecasting adjusted EBITDA per share growth of approximately 14% annually for 2026-2027, compared to 8.5% for municipal solid waste peers. InvestingPro data shows the company has maintained relatively low price volatility while delivering consistent growth, with additional insights available in the comprehensive Pro Research Report.

Barclays also highlighted GFL’s deleveraging trajectory, projecting leverage to decline from 4.4x at year-end 2024 to 3.0x by year-end 2027, alongside what it considers an "inexpensive valuation" at 14x next twelve months EV/EBITDA compared to about 15x for peers. Current InvestingPro analysis suggests the stock is fairly valued, with a current EV/EBITDA multiple of 15x and EBITDA of $1.39 billion.

The $62 price target is based on a 16x multiple applied to cumulative Q3 2026-Q2 2027 adjusted EBITDA, less net debt and minority interest, plus $5 per share for GFL’s equity stakes in ES and GIP, converted to USD at a 0.72 CAD/USD exchange rate.

Barclays simultaneously initiated coverage of GFL’s Toronto-listed shares (TSX:GFL) with an Overweight rating and CAD $86 price target.

In other recent news, GFL Environmental reported impressive second-quarter results for 2025, with earnings per share of $0.26, significantly surpassing the forecast of $0.12. The company’s revenue reached $1.68 billion, exceeding the expected $1.22 billion. Truist Securities raised its price target for GFL Environmental to $60 from $58, maintaining a Buy rating, following the company’s guidance raise and positive commentary on pricing and volume trends. BMO Capital also increased its price target to $53 from $51, citing GFL as the only waste management firm in its coverage to raise its 2025 EBITDA outlook despite economic uncertainties. TD Cowen reiterated its Buy rating and $64 price target, highlighting GFL’s accelerated merger and acquisition activity. This activity is expected to drive revenue estimates beyond current market expectations. These developments reflect strong investor confidence in GFL’s performance and potential for growth.

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