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Gfl Environmental Inc (TSE:GFL)
:GFL
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GFL Environmental (GFL) AI Stock Analysis

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TSE:GFL

GFL Environmental

(NYSE:GFL)

Rating:61Neutral
Price Target:
C$69.00
▲(5.28%Upside)
GFL Environmental's overall stock score reflects strong earnings performance and strategic execution, tempered by technical weaknesses and valuation concerns. Significant debt reduction and M&A activities provide optimism, but operational challenges and current market momentum suggest a cautious outlook.
Positive Factors
Financial Performance
GFL's reaffirmed 2025 guidance and multiple avenues to exceed it, including accelerating M&A, indicate strong financial performance.
Operational Improvement
The improved labor turnover and operational focus are expected to bring significant cost and safety benefits.
Negative Factors
Ambitious Targets
GFL's ambitious 2028 targets, while achievable, may be perceived as risky and conservative, potentially affecting investor sentiment.
Valuation Concerns
Current valuation concerns keep analysts on the sidelines, suggesting that optimism may already be factored in.

GFL Environmental (GFL) vs. iShares MSCI Canada ETF (EWC)

GFL Environmental Business Overview & Revenue Model

Company DescriptionGFL Environmental Inc. is a leading North American provider of diversified environmental solutions. The company operates in multiple sectors, including solid waste management, liquid waste management, and infrastructure services. GFL is dedicated to providing efficient and sustainable waste management services, offering a broad range of solutions such as collection, recycling, and disposal to residential, commercial, and industrial clients.
How the Company Makes MoneyGFL Environmental generates revenue through its comprehensive waste management services. The company's primary revenue streams include fees for waste collection and disposal services provided to residential, commercial, and industrial customers. Additionally, GFL earns income from recycling operations by selling recovered materials to manufacturers and processors. The company also benefits from infrastructure services, such as soil remediation and excavation. Strategic acquisitions and partnerships further enhance GFL's market presence and contribute to its earnings by expanding its service offerings and geographical reach.

GFL Environmental Earnings Call Summary

Earnings Call Date:Apr 30, 2025
(Q1-2025)
|
% Change Since: -4.69%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong positive performance with record revenue growth and margin expansion, successful debt reduction, and a robust M&A pipeline. Despite some challenges from weather impacts and commodity price volatility, the company remains confident in its strategic initiatives and future performance.
Q1-2025 Updates
Positive Updates
Record Growth in Revenue and EBITDA Margin
GFL reported a revenue growth of approximately 12.5% and adjusted EBITDA margin expansion of 120 basis points, marking the highest first quarter adjusted EBITDA margin in the company's history.
Positive Impact from Pricing Strategies
First quarter pricing of 5.7% exceeded expectations, contributing to margin improvements. The company is confident in achieving the pricing levels included in its 2025 guidance.
Successful Debt Reduction and Share Buybacks
GFL used $6 billion from the sale of its ES business to repay $3.5 billion in debt and repurchased $2.5 billion of outstanding shares, resulting in a record low net leverage ratio of 3.1x.
Strong M&A Pipeline
Year-to-date, GFL completed $240 million in M&A, acquiring annualized revenue of over $85 million. The company expects to meet or exceed its high-end estimates for M&A activity in 2025.
Improved Labor Turnover and Asset Utilization
Labor turnover rates improved by over 200 basis points compared to Q1 2024 and nearly 800 basis points compared to Q1 2023. The company also reported strong asset utilization contributing to margin performance.
Credit Rating Upgrades
Post-ES transaction, GFL's credit ratings were upgraded by both S&P and Moody's, reflecting the company's improved financial position.
Negative Updates
Weather-Related Volume Impacts
Significant weather impacts affected roll-off and special waste volumes in the first quarter, although positive volume trends were noted towards the end of the quarter.
Commodity Price Volatility
Decreases in energy prices reduced first quarter revenues from fuel surcharges, and the reduction in OCC and fiber pricing was only partially offset by an increase in non-fiber commodities.
Impact of Macroeconomic Uncertainty
There is potential concern about tariffs and macroeconomic uncertainty impacting CapEx and cost structure, although no direct material impacts have been observed yet.
Company Guidance
In the GFL First Quarter 2025 Earnings Call, the company reported a strong start to the fiscal year, exceeding its guidance with a 12.5% revenue growth and an adjusted EBITDA margin expansion of 120 basis points, marking the highest first-quarter adjusted EBITDA margin in its history. The company noted that its pricing strategies led to a 5.7% price increase, surpassing initial plans and contributing to a positive price-cost spread. Net leverage was reduced to 3.1x, the lowest in the company's history, following the sale of the ES business, which generated $6 billion in proceeds used to repay $3.5 billion of debt and repurchase $2.5 billion of shares. GFL's M&A pipeline remains robust, with $240 million spent on three deals year-to-date, and it anticipates exceeding the high end of its $700 million to $900 million M&A deployment estimates for the year. The company expects continued margin improvement driven by disciplined volume management and asset utilization optimization.

GFL Environmental Financial Statement Overview

Summary
GFL Environmental shows promising growth with increasing revenues and healthy EBITDA margins, despite operational challenges reflected in negative EBIT margins and volatile cash flow growth. The balance sheet displays a reasonable debt-to-equity ratio, but a high ROE due to one-time gains suggests the need for caution regarding sustainability.
Income Statement
70
Positive
GFL Environmental has shown a consistent increase in revenue over the years, indicative of solid growth in the waste management industry. The TTM (Trailing-Twelve-Months) gross profit margin stands at approximately 19.37%, with a net profit margin significantly impacted by a large net income figure due to unusual or non-operational gains. However, the EBIT margin is negative in the TTM, indicating operational challenges. EBITDA margin remains robust at 14.99%, reflecting strong operational cash generation capabilities.
Balance Sheet
65
Positive
The company's balance sheet shows a moderate debt-to-equity ratio of 0.93x in the TTM, which implies a balanced approach to leveraging. The equity ratio is approximately 41.34%, showcasing a healthy proportion of equity financing. However, the return on equity is substantially high at 35.53% due to the large net income figure, suggesting potential one-time gains rather than sustainable operational performance.
Cash Flow
60
Neutral
Cash flow analysis reveals a positive operating cash flow to net income ratio in the TTM, indicating strong cash conversion from earnings. The free cash flow to net income ratio is also positive, suggesting efficient capital expenditure management. However, the free cash flow growth rate has been volatile, which could pose risks to long-term cash flow stability.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue7.86B7.52B6.76B5.53B4.20B
Gross Profit1.49B1.27B797.60M527.60M190.10M
EBITDA1.22B2.33B1.63B1.09B303.80M
Net Income-722.70M45.40M-183.20M-606.80M-994.90M
Balance Sheet
Total Assets21.21B20.67B19.77B18.37B15.73B
Cash, Cash Equivalents and Short-Term Investments133.80M135.70M82.10M190.40M27.20M
Total Debt10.55B9.29B9.65B8.29B7.74B
Total Liabilities13.99B13.29B13.72B12.60B10.05B
Stockholders Equity6.98B7.18B6.04B5.78B5.68B
Cash Flow
Free Cash Flow347.20M-74.70M316.20M250.70M73.90M
Operating Cash Flow1.54B980.40M1.10B897.90M502.20M
Investing Cash Flow-1.68B-310.40M-1.73B-2.69B-4.35B
Financing Cash Flow163.20M-602.80M569.00M1.96B3.34B

GFL Environmental Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price65.54
Price Trends
50DMA
67.21
Negative
100DMA
67.41
Negative
200DMA
64.91
Positive
Market Momentum
MACD
-0.75
Negative
RSI
47.44
Neutral
STOCH
31.32
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GFL, the sentiment is Neutral. The current price of 65.54 is below the 20-day moving average (MA) of 65.59, below the 50-day MA of 67.21, and above the 200-day MA of 64.91, indicating a neutral trend. The MACD of -0.75 indicates Negative momentum. The RSI at 47.44 is Neutral, neither overbought nor oversold. The STOCH value of 31.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:GFL.

GFL Environmental Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
C$3.63B20.1016.22%2.43%13.51%-58.43%
75
Outperform
C$66.42B72.637.88%<0.01%12.84%-23.50%
65
Neutral
$11.06B15.735.16%1.93%3.12%-25.59%
61
Neutral
C$24.03B9.57-10.02%0.12%1.37%-9742.41%
54
Neutral
C$52.41M2,014.290.16%49.38%-93.75%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:GFL
GFL Environmental
65.54
12.68
23.99%
TSE:WCN
Waste Connections
257.03
15.89
6.59%
TSE:BLM
BluMetric Environmental
1.42
0.92
184.00%
TSE:SES
SECURE Waste Infrastructure
16.49
5.37
48.29%

GFL Environmental Corporate Events

Dividends
GFL Environmental Declares Q2 2025 Dividend
Positive
Jul 3, 2025

GFL Environmental Inc. has announced a cash dividend of US$0.0154 per share for the second quarter of 2025, payable on July 31, 2025, to shareholders recorded by July 14, 2025. This move reflects the company’s ongoing commitment to returning value to its shareholders and may influence its market positioning positively by reinforcing investor confidence.

The most recent analyst rating on (TSE:GFL) stock is a Hold with a C$54.00 price target. To see the full list of analyst forecasts on GFL Environmental stock, see the TSE:GFL Stock Forecast page.

Financial Disclosures
GFL Environmental to Announce Q2 2025 Financial Results
Neutral
Jun 25, 2025

GFL Environmental Inc. has announced the release date for its second quarter financial results for 2025, which will be made public after market close on July 30, 2025. The company will also host an investor conference call on July 31, 2025, to discuss these results, indicating a commitment to transparency and engagement with stakeholders.

The most recent analyst rating on (TSE:GFL) stock is a Hold with a C$54.00 price target. To see the full list of analyst forecasts on GFL Environmental stock, see the TSE:GFL Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 03, 2025