Casella Waste Q4 Revenue Up 9.7% But Margins Slip, Shares Fall 5%
Casella Waste Systems posted Q4 2025 adjusted EPS of $0.30, surpassing forecasts, on revenue of $469.1 million, up 9.7% year-over-year but slightly below consensus. Operating margin slid to 2.5% from 4.3% and free cash flow margin fell to 8.4% from 13.9%, triggering a 5% intraday share drop.
1. Q4 2025 Earnings Results
Casella reported adjusted earnings of $0.30 per share versus $0.22 expected, driven by 9.7% revenue growth. Total revenue reached $469.1 million, narrowly missing analyst projections and reflecting solid top-line momentum in core collection services.
2. Margin Compression
Operating margin declined to 2.5% from 4.3% year-ago due to increased fuel and labor costs. Free cash flow margin contracted to 8.4% from 13.9%, highlighting weaker cash conversion amid higher operating expenses.
3. Share Performance and Market Reaction
Shares fell 5% in afternoon trading as investors weighed profitability erosion. The stock is down 2.4% year-to-date and trading about 20% below its 52-week high, intensifying scrutiny on near-term cost controls.