Waste management company Casella (NASDAQ: CWST) met Wall Street’s revenue expectations in Q4 CY2025, with sales up 9.7% year on year to $469.1 million. The company’s outlook for the full year was close to analysts’ estimates with revenue guided to $1.98 billion at the midpoint. Its non-GAAP profit of $0.30 per share was 33.6% above analysts’ consensus estimates.

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“We delivered strong fourth quarter results in line with expectations, closing the year on a high note and carrying positive momentum into 2026,” said Edmond (“Ned”) R. Coletta, President and CEO of Casella Waste Systems, Inc.

Company Overview

Starting with the founder picking up garbage with a pickup truck he purchased using savings from high school, Casella (NASDAQ: CWST) offers waste management services for businesses, residents, and the government.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can have short-term success, but a top-tier one grows for years. Luckily, Casella Waste Systems’s sales grew at an incredible 18.9% compounded annual growth rate over the last five years. Its growth beat the average industrials company and shows its offerings resonate with customers.

Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Casella Waste Systems’s annualized revenue growth of 20.5% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated.

This quarter, Casella Waste Systems grew its revenue by 9.7% year on year, and its $469.1 million of revenue was in line with Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 8% over the next 12 months, a deceleration versus the last two years. Despite the slowdown, this projection is above average for the sector and indicates the market is baking in some success for its newer products and services.

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Operating Margin

Casella Waste Systems was profitable over the last five years but held back by its large cost base. Its average operating margin of 5.9% was weak for an industrials business. This result is surprising given its high gross margin as a starting point.

Analyzing the trend in its profitability, Casella Waste Systems’s operating margin decreased by 5.3 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. Casella Waste Systems’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers.

This quarter, Casella Waste Systems generated an operating margin profit margin of 2.5%, down 1.8 percentage points year on year. Since Casella Waste Systems’s operating margin decreased more than its gross margin, we can assume it was less efficient because expenses such as marketing, R&D, and administrative overhead increased.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Casella Waste Systems’s EPS grew at a decent 8.1% compounded annual growth rate over the last five years. However, this performance was lower than its 18.9% annualized revenue growth, telling us the company became less profitable on a per-share basis as it expanded.

Diving into the nuances of Casella Waste Systems’s earnings can give us a better understanding of its performance. As we mentioned earlier, Casella Waste Systems’s operating margin declined by 5.3 percentage points over the last five years. Its share count also grew by 25.2%, meaning the company not only became less efficient with its operating expenses but also diluted its shareholders.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Casella Waste Systems, its two-year annual EPS growth of 16.2% was higher than its five-year trend. This acceleration made it one of the faster-growing industrials companies in recent history.

In Q4, Casella Waste Systems reported adjusted EPS of $0.30, down from $0.41 in the same quarter last year. Despite falling year on year, this print easily cleared analysts’ estimates. Over the next 12 months, Wall Street expects Casella Waste Systems’s full-year EPS of $1.27 to grow 6%.

Key Takeaways from Casella Waste Systems’s Q4 Results

It was good to see Casella Waste Systems beat analysts’ EPS expectations this quarter. We were also happy its EBITDA outperformed Wall Street’s estimates. On the other hand, its revenue was in line and its full-year EBITDA guidance was in line with Wall Street’s estimates. Overall, this print was mixed but still had some key positives. The market seemed to be hoping for more, and the stock traded down 3% to $98.23 immediately after reporting.

So do we think Casella Waste Systems is an attractive buy at the current price? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).