Is Casella Waste Systems (CWST) a Stable Business to Invest in?

The London Company, an investment management company, released “The London Company Small Cap Strategy” second quarter 2023 investor letter. A copy of the same can be downloaded here. US stocks performed well in Q2, with the majority of the gain generated in the month of June. In the second quarter, the fund returned 2.5% gross (2.3% net) during the quarter compared to a 5.2% return for the Russell 2000 Index. Both sector exposure & stock selection were headwinds in the quarter. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.

The London Company Small Cap Strategy highlighted stocks like Casella Waste Systems, Inc. (NASDAQ:CWST) in the second quarter 2023 investor letter. Headquartered in Rutland, Vermont, Casella Waste Systems, Inc. (NASDAQ:CWST) engages in solid waste management services. On August 2, 2023, Casella Waste Systems, Inc. (NASDAQ:CWST) stock closed at $81.53 per share. One-month return of Casella Waste Systems, Inc. (NASDAQ:CWST) was -6.96%, and its shares lost 3.56% of their value over the last 52 weeks. Casella Waste Systems, Inc. (NASDAQ:CWST) has a market capitalization of $4.776 billion.

The London Company Small Cap Strategy made the following comment about Casella Waste Systems, Inc. (NASDAQ:CWST) in its second quarter 2023 investor letter:

“Initiated: Casella Waste Systems, Inc. (NASDAQ:CWST) – CWST is the 5th largest waste company in the U.S., and it’s the #1 player in the dense Northeast. CWST is vertically integrated and has significant rural market exposure (-70%) versus its peers. The Northeast hasn’t approved a new landfill permit in 30 years, so the scarcity value of landfills combined with CWST’s vertical integration has given it significant pricing power. We’re attracted to CWST’s leading position in a stable business with high degree of recurring revenue. It has low leverage and is family owned. Plus, as a smaller player in a consolidating industry, CWST could possibly be acquired by a large player in the future. Later in Q2, we added to our purchase, increasing the size to roughly 3%.”

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Casella Waste Systems, Inc. (NASDAQ:CWST) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 14 hedge fund portfolios held Casella Waste Systems, Inc. (NASDAQ:CWST) at the end of the first quarter which was 16 in the previous quarter.

We discussed Casella Waste Systems, Inc. (NASDAQ:CWST) in another article and shared Conestoga SMid Cap Growth Strategy’s views on the company. In addition, please check out our hedge fund investor letters Q2 2023 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.