Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Clean Harbors Inc (CLH), Waste Management, Inc. (WM): This Waste Disposal Company Looks Interesting After the Recent Acquisition

Page 1 of 2

Clean Harbors Inc (NYSE:CLH) has not been performing well on the market since the beginning of 2012. The stock’s price has declined from around $64 per share at the beginning of 2012 to $54.80 per share at the time of writing. As of March 2013, Clean Harbors Inc (NYSE:CLH) is in the portfolio of Ron Baron and Steven Cohen. Is it a good buy at its current price? Let’s find out.

Clean Harbors Inc (NYSE:CLH)Great strategic acquisition

Clean Harbors Inc (NYSE:CLH), incorporated in 1980, is considered to be one of the leaders in hazardous waste disposal business, operating in four business segments: Technical Services, Field Services, Industrial Services and Oil & Gas Field Services. The majority of the company’s adjusted EBITDA, $245 million, was generated from the Technical Services segment. The Industrial Services segment ranked second with $139.9 million in adjusted EBITDA in 2012, while the Oil & Gas Field Services and Field Services segments contributed only $75.8 million and $25 million, respectively, in adjusted EBITDA.

At the end of 2012, Clean Harbors Inc (NYSE:CLH) acquired Safety-Kleen, the biggest re-refiner and recycler of used oil in North America, for around $1.3 billion. The company felt excited about this acquisition, as it would strengthen Clean Harbors Inc (NYSE:CLH) in the small quantity waste generator market, support its waste treatment capabilities, tap on the increasing demand for recycled products, especially re-refined oil. The acquisition also enables Clean Harbors Inc (NYSE:CLH) to expand its Environmental Services business in North America. With more than 200,000 customer locations of Safety-Kleen, the cross-selling opportunities could be substantial. Clean Harbors has recently raised its cost synergies estimate to around $70 to $75 million for 2013. The full year adjusted EBITDA was expected to stay in the range of $605 – $620 million.

Because of the Safety-Klein acquisition, Clean Harbors increased its debt level substantially. As of March 2013, it had $1.42 billion in equity, $233 million in cash and short-term investments and $1.4 billion in long-term debt. The acquisition also boosted the goodwill and intangible asset level, at nearly $1.14 billion. At $54.80 per share, Clean Harbors is valued at $3.3 billion. Thus, the market values the company at around 7.2 times its forward EBITDA.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!