Covanta Holding Corporation (NYSE: CVA) and Heritage-Crystal Clean (NASDAQ:HCCI) are both small-cap oils/energy companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, risk, profitability and valuation.

Profitability

This table compares Covanta Holding Corporation and Heritage-Crystal Clean’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Covanta Holding Corporation -1.41% -9.81% -0.96%
Heritage-Crystal Clean 5.56% 6.76% 4.73%

Volatility & Risk

Covanta Holding Corporation has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500. Comparatively, Heritage-Crystal Clean has a beta of 2.09, meaning that its stock price is 109% more volatile than the S&P 500.

Valuation and Earnings

This table compares Covanta Holding Corporation and Heritage-Crystal Clean’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Covanta Holding Corporation $1.71 billion 1.16 $296.00 million ($0.19) -80.26
Heritage-Crystal Clean $355.46 million 1.23 $41.31 million $0.86 22.50

Covanta Holding Corporation has higher revenue and earnings than Heritage-Crystal Clean. Covanta Holding Corporation is trading at a lower price-to-earnings ratio than Heritage-Crystal Clean, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Covanta Holding Corporation and Heritage-Crystal Clean, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Covanta Holding Corporation 1 0 6 0 2.71
Heritage-Crystal Clean 0 1 4 0 2.80

Covanta Holding Corporation currently has a consensus price target of $17.07, suggesting a potential upside of 11.94%. Heritage-Crystal Clean has a consensus price target of $22.80, suggesting a potential upside of 17.83%. Given Heritage-Crystal Clean’s stronger consensus rating and higher possible upside, analysts plainly believe Heritage-Crystal Clean is more favorable than Covanta Holding Corporation.

Insider and Institutional Ownership

96.6% of Covanta Holding Corporation shares are held by institutional investors. Comparatively, 55.6% of Heritage-Crystal Clean shares are held by institutional investors. 11.6% of Covanta Holding Corporation shares are held by insiders. Comparatively, 14.8% of Heritage-Crystal Clean shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Covanta Holding Corporation pays an annual dividend of $1.00 per share and has a dividend yield of 6.6%. Heritage-Crystal Clean does not pay a dividend. Covanta Holding Corporation pays out -526.3% of its earnings in the form of a dividend.

Summary

Heritage-Crystal Clean beats Covanta Holding Corporation on 9 of the 15 factors compared between the two stocks.

Covanta Holding Corporation 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.

Heritage-Crystal Clean Company Profile

Heritage-Crystal Clean, Inc. provides full-service parts cleaning, containerized waste management, used oil collection, vacuum truck services and antifreeze recycling. The Company owns and operates a used oil re-refinery. The Company operates through two segments: Environmental Services and Oil Business. The Company provides hazardous and non-hazardous waste services to small and mid-sized customers in both the manufacturing and vehicle maintenance sectors. The Environmental Services segment consists of the Company’s parts cleaning, containerized waste management, vacuum truck services, used antifreeze recycling activities and field services. The Oil Business segment consists of used oil collection activities, sale of recycled fuel oil, re-refining activities, and oil filter removal and disposal services. Through its re-refining process, the Company recycles used oil into lubricant base oil and by-products, and it is a supplier to firms that produce and market finished lubricants.

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