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(B)(N) CLH Clean Harbors Incorporated

November 26, 2013

Drama. Clean Harbors posted a cheery third quarter ending in September and most analysts who follow the company rate it as a “buy” but not every pencil is that sharp (The Street, November 26, 2013, Greenberg: Clean Harbors Is Not Cleaning Up).

The $3.2 billion company has been growing by “leaps and bounds” and acquisitions deemed “accretive”, the most recent being Evergreen Oil Incorporated out of bankruptcy for $60 million and Safety-Kleen Incorporated for $1.25 billion late last year.

It's Your Turn!

It’s Your Turn!

The company is also 40% owned by a dozen institutional investors including mutual funds and private equity companies and their large positions are able to move the stock price one way or the other depending on the kinds of “deals” that they are able to craft amongst themselves when one of them wants or needs to “roll over”, so to speak.

We can’t play right now because the ambient stock prices are basically flat, though volatile, and flirting with the Risk Price (SF) which is $56 to $60 and down from $68 last year. Please see Exhibit 1 below.

The company doesn’t pay a dividend and shareholders can only make money by buying and selling the stock to each other, regardless of how well the company is doing in its business. And we know that earnings don’t really matter.

Our estimate of the downside in the stock price due to the demonstrated volatility in the stock price is minus ($4) per share for the next quarter and so, it could be trading between the current $53 and $50 to $58 without surprise.

However, the upcoming 2014 is likely to be a year that is full of surprises and will be difficult (or “interesting”) for the “volatility” players who miss the jump (Morningstar USA, November 21, 2014, Lee: Expect Below-Average Stock Returns Ahead). Please stay tuned. We know how to play that game too.

Exhibit 1: (B)(N) CLH Clean Harbors Incorporated – Risk Price Chart

(B)(N) CLH Clean Harbors Incorporated

(B)(N) CLH Clean Harbors Incorporated

Clean Harbors Incorporated, through its subsidiaries, provides environmental, energy and industrial services throughout North America.

(Please Click on the Chart to make it larger if required.)

From the Company: Clean Harbors Incorporated, through its subsidiaries, provides environmental, energy, and industrial services in the United States, Puerto Rico, Canada, and internationally. It operates in four segments: Technical Services, Field Services, Industrial Services, and Oil and Gas Field Services. The Technical Services segment offers hazardous material management services, including the packaging, collection, transportation, treatment, and disposal of hazardous and non-hazardous waste at company-owned incineration, landfill, wastewater, and other treatment facilities. The Field Services segment provides various environmental cleanup services on customer sites or other locations on a scheduled or emergency response basis, including tank cleaning, decontamination, remediation, and spill cleanup; used oil and oil products recycling; and filtration and water treatment services. The Industrial Services segment offers industrial and specialty services, such as high-pressure and chemical cleaning, catalyst handling, decoking, material processing, and industrial lodging services to refineries, chemical plants, oil sands facilities, pulp and paper mills, and other industrial facilities. The Oil and Gas Field Services segment provides fluid handling, fluid hauling, production servicing, surface rentals, seismic services, and directional boring services to the energy sector serving oil and gas exploration, production, and power generation. The company has approximately 400 service locations. It serves Fortune 500 companies, midsize and small public and private entities, and governmental entities. Clean Harbors, Inc. was founded in 1980, has 13,000 employees and is headquartered in Norwell, Massachusetts.

For more information and additional references to the theory, please see our recent Post, The RiskWerk Company Glossary.

And for more on what risk averse investing has done for us this year, please see our recent Posts on The S&P TSX “Hangdog” Market or The Wall Street Put or specialty markets such as The Dow Transports & Utilities or (B)(N) The Woods Are Burning, or for the real class actionLa Dolce Vita – Let’s Do Prada! and It’s For You, Dear on the smartphone business.

And for more stocks at high prices, The World’s Most Talked About Stocks or Earnings Don’t Matter – NASDAQ 100.

And for more on what’s Working in AmericaBig OilShopping in America or Banking in America, to name just a few.

Postscript

We are The RiskWerk Company and care not a jot for mutual funds, hedge funds, “alternative investments”, the “risk/reward equation” and every other unprovable artifact of investment lore. We have just one product

The Perpetual Bond
Alpha-smart with 100% Capital Safety and 100% Liquidity
Guaranteed
With No Fees and No Loads on Capital

For more information on RiskWerk, please follow the Tags or Categories attached to this Letter or simply enter Search for additional references to any term that we have used. Related data may be obtained from us for free in a machine readable format by request to RiskWerk@gmail.com.

Disclaimer

Investing in the bond and stock markets has become a highly regulated and litigious industry but despite that, there remains only one effective rule and that is caveat emptor or “buyer beware”. Nothing that we say should be construed by any person as advice or a recommendation to buy, sell, hold or avoid the common stock or bonds of any public company at any time for any purpose. That is the law and we fully support and respect that law and regulation in every jurisdiction without exception and without qualification to the best of our knowledge and ability. We can only tell you what we do and why we do it or have done it and we know nothing at all about the future or the future of stock prices of any company nor why they are what they are, now. The author retains all copyrights to his works in this blog and on this website. The Perpetual Bond®™ is a registered trademark and patented technology of The RiskWerk Company and RiskWerk Limited (“Company”) . The Canada Pension Bond®™ and The Medina Bond®™ are registered trademarks or trademarks of the Company as are the words and phrases “Alpha-smart”, “100% Capital Safety”, “100% Liquidity”, ”price of risk”, “risk price”, and the symbols “(B)”, “(N)” and N*.

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