Covanta (NYSE: CVA) is one of 20 public companies in the “Waste Management, Disposal & Recycling Services” industry, but how does it contrast to its peers? We will compare Covanta to similar companies based on the strength of its analyst recommendations, institutional ownership, valuation, risk, dividends, profitability and earnings.
This table compares Covanta and its peers’ net margins, return on equity and return on assets.
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This is a breakdown of current recommendations for Covanta and its peers, as provided by MarketBeat.com.
||Strong Buy Ratings
Covanta currently has a consensus target price of $17.79, indicating a potential upside of 16.63%. As a group, “Waste Management, Disposal & Recycling Services” companies have a potential upside of 8.34%. Given Covanta’s stronger consensus rating and higher probable upside, equities analysts clearly believe Covanta is more favorable than its peers.
Valuation and Earnings
This table compares Covanta and its peers gross revenue, earnings per share (EPS) and valuation.
Covanta has higher revenue, but lower earnings than its peers. Covanta is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.
Institutional & Insider Ownership
94.8% of Covanta shares are owned by institutional investors. Comparatively, 53.0% of shares of all “Waste Management, Disposal & Recycling Services” companies are owned by institutional investors. 11.6% of Covanta shares are owned by insiders. Comparatively, 12.3% of shares of all “Waste Management, Disposal & Recycling Services” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Covanta pays an annual dividend of $1.00 per share and has a dividend yield of 6.6%. Covanta pays out -200.0% of its earnings in the form of a dividend. As a group, “Waste Management, Disposal & Recycling Services” companies pay a dividend yield of 1.8% and pay out 98.2% of their earnings in the form of a dividend. Covanta is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.
Volatility & Risk
Covanta has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500. Comparatively, Covanta’s peers have a beta of 0.62, suggesting that their average stock price is 38% less volatile than the S&P 500.
Covanta beats its peers on 11 of the 14 factors compared.
Covanta Company Profile
Covanta Holding Corporation is a holding company. The Company, through its subsidiaries, owns and operates infrastructure for the conversion of waste to energy, as well as other waste disposal and renewable energy production businesses. The Company operates through North America segment, which consists of waste and energy services operations located primarily in the United States and Canada. Outside of North America, the Company is constructing an energy-from-waste (EfW) facility in Dublin, Ireland. The Company holds interests in an EfW facility in Italy and an infrastructure business in China, which is engaged in EfW operations. These EfW projects generate revenue from three main sources: fees charged for operating projects or processing waste received; the sale of electricity and/or steam, and the sale of ferrous and non-ferrous metals that are recovered from the waste stream as part of the EfW process.
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