Casella Waste: Positioned for Growth with Strong Free Cash Flow and Resilience

Casella Waste (CWST) has received a new Buy rating, initiated by TD Cowen analyst, James Schumm.

James Schumm has given his Buy rating due to a combination of factors that highlight Casella Waste’s strong potential for growth and resilience. One key aspect is the company’s ability to maintain free cash flow durability regardless of economic conditions, making it an attractive investment. Additionally, while tariff implications are expected to have a limited impact, Casella is well-positioned to increase prices if cost inflation arises, as a significant portion of its business is not bound by long-term contracts.
Furthermore, the recent challenges in landfill volumes are anticipated to reverse, with potential for significant growth over time. The closure of a competing landfill is expected to provide a boost, potentially increasing volumes by 18% and contributing to an 8% rise in 2025. Casella’s 2025 guidance is considered conservative, with opportunities for revenue and EBITDA to exceed expectations due to operating leverage and high-margin landfill contributions. Overall, Casella’s potential for free cash flow growth and EBITDA margin improvement positions it to outperform its peers.

Based on the recent corporate insider activity of 55 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of CWST in relation to earlier this year.