Clean Harbors
CLH
$311.43
-1.38%
Clean Harbors, Inc. is an environmental and industrial services provider operating through two segments: Environmental Services, which handles hazardous and non-hazardous waste collection, transportation, treatment, recycling, disposal, and industrial maintenance, and Safety-Kleen Sustainability Solutions, which collects used oil and manufactures base oil, vacuum gas oil, and lubricants. As North America's largest provider of hazardous waste management services, the company occupies a unique competitive position characterized by high barriers to entry from permitting, incineration capacity, and a dense collection network, making it a critical infrastructure player for industrial and automotive customers. The current investor narrative centers on the company's ability to sustain margin expansion in its core Environmental Services segment while navigating softer conditions in the Safety-Kleen re-refining business, where base oil spreads have compressed. Recent attention has focused on the company's aggressive capital deployment through acquisitions and share repurchases, alongside questions about whether its Q1 2026 revenue growth of just 1.9% year-over-year signals a broader industrial slowdown or a temporary pause before reacceleration.…
CLH
Clean Harbors
$311.43
Investment Opinion: Should I buy CLH Today?
The synthesized recommendation is Hold. While the analyst consensus is Buy with an average target of $359.93 (14% upside), the recent margin collapse and revenue deceleration warrant caution. The core thesis is that Clean Harbors' competitive moat and defensive characteristics are offset by near-term earnings uncertainty and a valuation that already prices in a recovery.
Supporting evidence for a Hold includes: (1) the forward PE of 31.79x is near the middle of the historical range but above the industry average, leaving little room for error; (2) revenue growth of 1.93% in Q1 2026 is well below the 8.2% seen in 2025, signaling a slowdown; (3) profitability has deteriorated sharply, with gross margin at 22.34% versus over 33% in mid-2025; (4) free cash flow turned negative in Q1 at -$92.3 million, though trailing twelve-month FCF remains positive at $464.5 million; and (5) the implied upside to the analyst average target is only 14%, which is modest relative to the downside risk to the 52-week low of $201.34 (36% below current).
The biggest risks that could invalidate the Hold rating are a continued decline in base oil spreads, a broader industrial slowdown, and integration challenges from acquisitions. The rating would upgrade to Buy if gross margins recover above 28% and revenue growth accelerates above 5%, or if the stock pulls back to the $280 support level. It would downgrade to Sell if gross margins fall below 20% or if revenue growth turns negative. Relative to its history and peers, CLH appears fairly valued to slightly overvalued, with the market pricing in a margin recovery that has yet to materialize.
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CLH 12-Month Price Forecast
Clean Harbors presents a balanced risk/reward profile. The company's unique competitive position in hazardous waste and defensive characteristics (beta 0.852) are offset by severe margin compression and slowing revenue growth. The analyst consensus remains bullish, but the 14% upside to the average target is modest relative to the 36% downside to the 52-week low. The key question is whether the margin decline is cyclical or structural; if cyclical, the stock could re-rate toward $390, but if structural, it could fall below $280. I would upgrade to bullish if gross margins recover above 28% and revenue growth exceeds 5%, and downgrade to bearish if margins fall below 20% or revenue growth turns negative.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Clean Harbors's 12-month outlook, with a consensus price target around $359.93 and implied upside of +15.6% versus the current price.
Average Target
$359.93
0 analysts
Implied Upside
+15.6%
vs. current price
Analyst Count
—
covering this stock
Price Range
$325 - $390
Analyst target range
Clean Harbors is covered by 15 analysts, with a consensus recommendation of "Buy" and a recommendation mean of 1.59 (where 1 is a Strong Buy and 5 is a Strong Sell). The average target price is $359.93, which implies an upside of approximately 14.0% from the current price of $315.80. The consensus leans bullish, with the majority of analysts rating the stock a Buy or Outperform, as evidenced by recent ratings from Citigroup (Buy), BMO Capital (Outperform), Oppenheimer (Outperform), TD Cowen (Buy), and Needham (Buy), while Barclays, UBS, and Wells Fargo maintain Equal Weight or Neutral ratings. The estimated EPS average of $14.24 for the forward period suggests that analysts expect a significant earnings recovery, which contrasts with the trailing EPS of $0.03 and the most recent quarterly EPS of $1.20.
The target price range spans from a low of $325.00 to a high of $390.00, a spread of $65.00 or 20% of the average target, indicating moderate uncertainty among analysts. The high target of $390.00 implies a 23.5% upside from the current price and likely assumes a combination of multiple expansion, successful integration of acquisitions, and a recovery in the Safety-Kleen segment's margins. The low target of $325.00, which is only 2.9% above the current price, suggests a more conservative view that prices in continued margin compression and sluggish industrial demand. The institutional ratings data shows a pattern of stable ratings over the past six months, with no upgrades or downgrades, indicating that analysts are in a wait-and-see mode ahead of the next earnings report. The wide target spread, combined with the recent 1-month price decline of 2.90%, suggests that the market is uncertain about the near-term trajectory, and a positive earnings surprise could catalyze a move toward the higher end of the range.
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Bulls vs Bears: CLH Investment Factors
The bear case currently has stronger near-term evidence, as Q1 2026 results revealed a dramatic margin collapse (gross margin down to 22.34% from over 33% in mid-2025) and revenue growth of just 1.93%, well below the 8.2% pace of 2025. However, the bull case rests on the company's durable competitive moat, defensive beta of 0.852, strong liquidity (current ratio 2.33), and a consensus analyst target of $359.93 implying 14% upside. The single most important tension is whether the margin compression is cyclical—driven by temporary base oil spread weakness and seasonal factors—or structural, reflecting a permanently lower profitability profile. If margins recover toward the 30%+ gross margin levels of 2025, the stock could re-rate toward the high target of $390; if they remain depressed, the current PE of 32x is unjustified and the stock could test the low target of $325 or lower.
Bullish
- Analyst consensus Buy with 14% upside: 15 analysts cover CLH with a consensus recommendation of 'Buy' and a mean rating of 1.59 (1=Strong Buy, 5=Strong Sell). The average target price of $359.93 implies approximately 14.0% upside from the current price of $315.80, and the high target of $390.00 implies 23.5% upside.
- Defensive, low-beta outperformer: CLH has a beta of 0.852, roughly 15% less volatile than the S&P 500, yet it has returned 33.17% over the past year versus the S&P 500's 15.01%, generating 18.16% relative strength. This combination of defensive characteristics and market-beating returns is rare and attractive for risk-adjusted portfolios.
- Strong balance sheet and liquidity: The current ratio of 2.33 indicates robust short-term liquidity, and the debt-to-equity ratio of 1.26 is manageable for a capital-intensive industrial. The company generated $464.5 million in trailing twelve-month free cash flow, funding both capital expenditures and share repurchases.
- High barriers to entry in hazardous waste: As North America's largest hazardous waste management provider, CLH benefits from permitting, incineration capacity, and a dense collection network that are difficult and time-consuming to replicate. This moat supports pricing power and long-term contracts with industrial and automotive customers.
Bearish
- Severe margin compression across the board: Gross margin collapsed to 22.34% in Q1 2026 from 32.33% in Q3 2025 and 33.32% in Q2 2025, while operating margin fell to 8.15% from 12.46% and 13.57% in the same periods. Net margin of 4.33% is down from 7.67% in Q3 2025, indicating broad-based profitability deterioration.
- Revenue growth has stalled: Q1 2026 revenue of $1.46 billion grew just 1.93% year-over-year, a sharp deceleration from 8.2% growth in both Q2 and Q3 2025. The sequential decline from $1.55 billion in Q2 2025 to $1.46 billion in Q1 2026 raises concerns about whether the company can return to mid-single-digit organic growth.
- Negative free cash flow in Q1: Q1 2026 free cash flow was negative $92.3 million, driven by a $185.1 million working capital outflow and $98.6 million in capital expenditures. While seasonal, this cash burn highlights the company's vulnerability during cyclical troughs and its reliance on external financing.
- Elevated valuation versus history: The trailing PE of 32.08x and forward PE of 31.79x are near the middle of the historical range (8.03x to 59.74x), but the EV/EBITDA of 13.29x is above the historical median of around 11x. This suggests the market is pricing in optimistic margin recovery that may not materialize.
CLH Technical Analysis
Clean Harbors is in a sustained uptrend, with the stock up 33.17% over the past year and 29.72% year-to-date, significantly outpacing the S&P 500's 15.01% and 11.70% respective gains. At a current price of $315.80, the stock is trading at approximately 85% of its 52-week range (low of $201.34 to high of $335.94), positioning it in the upper quartile of its annual range. This positioning suggests strong momentum but also raises the risk of overextension, particularly given the stock's beta of 0.852, which indicates it is roughly 15% less volatile than the broader market, implying that the rally has been driven by company-specific factors rather than broad market beta. The 52-week high of $335.94 remains a key psychological and technical resistance level, while the 52-week low of $201.34 represents a distant but significant support zone.
Recent momentum has decelerated, with the stock down 2.90% over the past month, contrasting sharply with its 9.42% gain over three months and 14.47% gain over six months. This divergence between the 1-month decline and the longer-term uptrend suggests a temporary pullback or consolidation phase rather than a trend reversal, especially given the stock's relative strength of -1.94% versus the S&P 500 over the past month. The 1-month underperformance relative to the broader market, which declined only 0.96%, indicates that Clean Harbors has faced idiosyncratic selling pressure, potentially tied to profit-taking after a strong run or concerns about near-term earnings. Volume of 538,242 shares on the most recent day is relatively light, suggesting the pullback lacks conviction on the sell side, which could set the stage for a resumption of the uptrend if buying interest returns.
Key technical levels to monitor include support at the 52-week low of $201.34, which is 36% below the current price and represents a major floor, and resistance at the 52-week high of $335.94, just 6.4% above the current price. A breakout above $335.94 would signal renewed momentum and likely attract trend-following capital, potentially opening the door to new all-time highs, while a breakdown below the recent consolidation zone around $310 could test deeper support near $280, where the stock found buyers in June and July. The beta of 0.852 implies that for a 1% move in the S&P 500, Clean Harbors would be expected to move only 0.85%, making it a relatively defensive holding within the industrials sector, though the stock's max drawdown of -18.82% over the past year shows it is not immune to sharp corrections.
Beta
0.85
0.85x market volatility
Max Drawdown
-18.8%
Largest decline past year
52-Week Range
$201-$336
Price range past year
Annual Return
+32.8%
Cumulative gain past year
| Period | CLH Return | S&P 500 |
|---|---|---|
| 1m | -1.4% | +1.0% |
| 3m | +7.4% | +5.4% |
| 6m | +8.0% | +17.8% |
| 1y | +32.8% | +16.5% |
| ytd | +27.9% | +13.4% |
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CLH Fundamental Analysis
Clean Harbors' revenue trajectory has decelerated markedly, with Q1 2026 revenue of $1.46 billion representing just 1.93% year-over-year growth, a sharp slowdown from the 8.2% growth in Q2 2025 and 8.2% in Q3 2025. The sequential trend shows revenue declining from $1.55 billion in Q2 2025 to $1.46 billion in Q1 2026, reflecting both seasonal factors and underlying softness in the Safety-Kleen Oil segment, which generated only $139 million in the most recent quarter. Segment data reveals that Technical Services ($448 million) and Safety-Kleen Environmental Services ($338 million) are the largest contributors, while the Field and Emergency Response segment ($231 million) and Industrial Services ($303 million) provide diversification. The deceleration in growth raises questions about whether the company can return to mid-single-digit organic growth or whether it will need to rely on acquisitions to sustain its top line.
Profitability remains solid but is showing signs of compression, with Q1 2026 net income of $63.2 million and a net margin of 4.33%, down from 5.77% in Q4 2025 and 7.67% in Q3 2025. Gross margin in Q1 2026 was 22.34%, a significant decline from 32.33% in Q3 2025 and 33.32% in Q2 2025, reflecting higher costs and unfavorable mix, particularly in the re-refining business where base oil spreads have narrowed. The operating margin of 8.15% in Q1 2026 is well below the 12.46% and 13.57% reported in Q3 2025 and Q2 2025, respectively, indicating that the company is experiencing margin pressure across the board. Despite this, the company remains profitable, and its gross margin of 22.34% is consistent with the lower end of its historical range, suggesting that the current compression may be cyclical rather than structural.
Clean Harbors' balance sheet shows a debt-to-equity ratio of 1.26, which is elevated but manageable for a capital-intensive industrial company, and a current ratio of 2.33, indicating strong short-term liquidity. Free cash flow on a trailing twelve-month basis is $464.5 million, but Q1 2026 free cash flow was negative $92.3 million due to a $185.1 million working capital outflow and $98.6 million in capital expenditures, highlighting the seasonal nature of the business. Return on equity of 14.24% is respectable, though it has declined from higher levels in prior quarters, and the company's cash position of $548 million at the end of Q1 2026 provides a cushion. The company's reliance on external financing is moderate, with net cash from financing of -$57.6 million in Q1 2026, reflecting debt repayments and share repurchases, but the negative free cash flow in the quarter underscores the need for careful cash management during seasonal troughs.
Quarterly Revenue
$1.5B
2026-03
Revenue YoY Growth
+1.9%
YoY Comparison
Gross Margin
22.3%
Latest Quarter
Free Cash Flow
$464472000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is CLH Overvalued?
Because Clean Harbors is profitable, with trailing net income positive and EPS of $0.03 on a trailing basis (though this appears distorted by one-time items), the PE ratio is the primary metric. The trailing PE is 32.08x, while the forward PE is 31.79x, a narrow gap that implies the market is not pricing in significant earnings growth over the next year. This is consistent with the company's recent earnings trajectory, where Q1 2026 EPS of $1.20 was below the year-ago quarter's $1.09 but well below the $2.22 and $2.37 reported in Q3 and Q2 2025, respectively. The forward PE of 31.79x is based on estimated EPS of $14.24, which seems unusually high relative to the quarterly run rate, suggesting that the analyst estimates may be for a different fiscal period or include adjustments.
Compared to the Waste Management industry, Clean Harbors trades at a premium, with a PS ratio of 2.07x and an EV/EBITDA of 13.29x. The industry average PS ratio for waste management companies is typically in the 2.5x to 3.5x range, and EV/EBITDA multiples often range from 10x to 14x, placing Clean Harbors at the lower end of the EV/EBITDA range but at a discount on PS. The company's PB ratio of 4.54x is above the industry average of around 3.5x, reflecting its strong brand and market position. The premium on PB is justified by Clean Harbors' superior ROE of 14.24% compared to the industry average of around 10%, but the discount on PS suggests the market is pricing in slower growth relative to peers.
Historically, Clean Harbors' PE ratio has ranged from a low of 8.03x in Q2 2022 to a high of 59.74x in Q1 2026, with the current 32.08x sitting near the middle of that range. The PS ratio of 2.07x is near the low end of its historical range, which has been as high as 10.38x in Q1 2026 and as low as 3.51x in Q2 2022, though the current figure appears to be calculated on a different basis. The EV/EBITDA of 13.29x is above the historical median of around 11x, suggesting that the market is pricing in optimistic expectations for margin recovery and growth. If the company fails to deliver on these expectations, there is downside risk to the multiple, but if it executes, the stock could re-rate higher.
PE
32.1x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 8x~45x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
13.3x
Enterprise Value Multiple
Investment Risk Disclosure
Clean Harbors faces significant financial and operational risks. The most acute is the margin compression: gross margin fell to 22.34% in Q1 2026 from 33.32% in Q2 2025, and operating margin dropped to 8.15% from 13.57% over the same period. This 1,100 basis point swing in gross margin directly threatens earnings power, as evidenced by Q1 2026 EPS of $1.20 versus $2.37 in Q2 2025. Additionally, the company's debt-to-equity ratio of 1.26 and negative Q1 free cash flow of -$92.3 million, driven by a $185.1 million working capital outflow, highlight liquidity strain during seasonal troughs. Revenue concentration in the Environmental Services segment, which includes Technical Services ($448 million) and Safety-Kleen Environmental Services ($338 million), means that any slowdown in industrial activity could disproportionately impact results.
Market and competitive risks are also material. CLH trades at a forward PE of 31.79x and an EV/EBITDA of 13.29x, above its historical median EV/EBITDA of around 11x, leaving it vulnerable to multiple compression if growth disappoints. The waste management industry is highly regulated, and changes in environmental regulations could increase compliance costs or reduce demand for certain services. Furthermore, the company's beta of 0.852 indicates lower market correlation, but its 1-month relative strength of -1.94% versus the S&P 500 shows it can underperform due to idiosyncratic factors. The recent 2.90% one-month price decline, contrasting with a 9.42% three-month gain, suggests profit-taking and uncertainty ahead of earnings.
The worst-case scenario would involve a continued deterioration in base oil spreads, a broader industrial recession reducing waste volumes, and a failure to integrate acquisitions efficiently. In this scenario, the stock could retest its 52-week low of $201.34, representing a 36% decline from the current price of $315.80. Even a move to the analyst low target of $325.00 would be a modest 2.9% gain, but if margins remain depressed, the stock could fall below $280, where it found support in June and July. The maximum drawdown over the past year was -18.82%, but a more severe downturn could exceed that, especially given the negative free cash flow and high debt levels.
FAQ
The key risks for CLH are ranked as follows: (1) Financial risk: Gross margin collapsed to 22.34% in Q1 2026 from 33.32% in Q2 2025, and Q1 free cash flow was negative $92.3 million, highlighting earnings and cash flow volatility. (2) Competitive/operational risk: The Safety-Kleen segment generated only $139 million in the most recent quarter, with base oil spreads compressed, and any further weakness could drag overall profitability. (3) Macro risk: With a beta of 0.852, CLH is defensive, but a broader industrial slowdown could reduce waste volumes and pricing power. (4) Valuation risk: The forward PE of 31.79x and EV/EBITDA of 13.29x are above historical medians, leaving the stock vulnerable to multiple compression if growth disappoints. The most severe risk is a sustained margin decline that would force analysts to cut estimates and targets.
The 12-month forecast for CLH includes three scenarios: Bull case (25% probability) with a target range of $360-$390, assuming margin recovery and revenue acceleration; Base case (55% probability) with a target range of $325-$360, assuming gradual margin stabilization and 3-5% revenue growth; and Bear case (20% probability) with a target range of $201-$280, assuming persistent margin pressure and industrial weakness. The base case is most likely, supported by the analyst average target of $359.93 and the company's defensive characteristics. The key assumption is that gross margins recover to the mid-20% range by year-end 2026. If margins instead remain below 20%, the bear case becomes more probable.
CLH appears fairly valued to slightly overvalued. The forward PE of 31.79x is near the middle of its historical range (8.03x to 59.74x) but above the waste management industry average. The PS ratio of 2.07x is below the industry average of 2.5x-3.5x, suggesting a discount on sales, but the EV/EBITDA of 13.29x is above the historical median of around 11x. The market is pricing in a margin recovery that has yet to materialize, as evidenced by the gross margin decline to 22.34% in Q1 2026. If margins recover, the stock could re-rate higher; if not, the multiple is at risk of compression. Relative to its own history and peers, CLH is not cheap, and the 14% upside to the average target is modest.
CLH is a Hold-rated stock with a balanced risk/reward profile. The analyst consensus is Buy with an average target of $359.93, implying 14% upside, but the stock trades at a forward PE of 31.79x, which is above the industry average and leaves little room for error. The biggest downside risk is a retest of the 52-week low of $201.34, representing a 36% decline, if margin compression persists. For long-term investors seeking a defensive industrial with a wide moat, CLH could be a good buy on pullbacks to the $280 support level. However, near-term earnings uncertainty and negative Q1 free cash flow of -$92.3 million suggest waiting for clearer signs of margin recovery before initiating a position.
CLH is more suitable for long-term investment than short-term trading. The company operates in a stable, regulated industry with high barriers to entry, and its beta of 0.852 indicates lower volatility, making it a defensive holding. However, the current margin compression and negative free cash flow in Q1 2026 introduce near-term uncertainty that could lead to volatility. The stock does not pay a dividend (payout ratio 0%), so returns depend on capital appreciation. A minimum holding period of 2-3 years is recommended to allow for margin recovery and the realization of acquisition synergies. Short-term traders might find opportunities around earnings announcements, but the risk/reward is less favorable given the 36% downside to the 52-week low.
