Quest Resource’s first quarter results were met with a negative market reaction, as revenue declined year-over-year and missed Wall Street’s expectations. Management attributed the underperformance to ongoing weakness in its industrial segment, particularly from clients in the agricultural sector experiencing lower production volumes. However, CEO Perry Moss noted that the company’s diversification into non-industrial end markets, such as restaurants and retail, partially offset these declines. Moss acknowledged, “The industrial portfolio as a whole remains challenged as a result of the softer manufacturing environment,” but highlighted improvements throughout the quarter due to new customer wins and cost control initiatives.
Is now the time to buy QRHC? Find out in our full research report (it’s free for active Edge members).
Quest Resource (QRHC) Q1 CY2026 Highlights:
- Revenue: $61.74 million vs analyst estimates of $62.2 million (9.8% year-on-year decline, 0.7% miss)
- EPS (GAAP): -$0.11 vs analyst estimates of -$0.10 (in line)
- Adjusted EBITDA: $1.79 million vs analyst estimates of $1.8 million (2.9% margin, relatively in line)
- Operating Margin: 0.4%, up from -3% in the same quarter last year
- Market Capitalization: $22.43 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Quest Resource’s Q1 Earnings Call
- Aaron Michael Spychalla (Craig-Hallum): Asked about the scale and ramp-up potential of the new quick-service restaurant (QSR) win. CEO Perry W. Moss explained it was a seven-figure account, covering over half the portfolio, and highlighted ample room for continued expansion.
- Aaron Michael Spychalla (Craig-Hallum): Inquired about the success and growth potential of the share-of-wallet initiatives. Moss detailed that the company has several major opportunities with existing customers and is seeing a robust pipeline, expecting further growth in this area.
- Aaron Michael Spychalla (Craig-Hallum): Sought clarification on inflation and commodity cost impacts. Moss responded that the company proactively manages vendor contracts to minimize cost pass-throughs and has not seen significant negative effects to date.
- Gerard J. Sweeney (ROTH Capital): Questioned the industrial segment's revenue exposure and the impact of macro recovery signals. CFO Brett W. Johnston and Moss clarified that headwinds are concentrated in a few agricultural clients and that recent volume trends are cautiously optimistic.
- Gerard J. Sweeney (ROTH Capital): Queried further about the QSR account’s split and service lines. Moss confirmed Quest Resource captured just over half the locations and expects similar proportions across service lines, with potential for further expansion.
Catalysts in Upcoming Quarters
In the upcoming quarters, our analysts will be monitoring (1) the pace at which new non-industrial customer wins, particularly in restaurants and retail, contribute to gross profit growth, (2) the effectiveness of operational excellence initiatives in driving margin improvements and cash generation, and (3) any recovery in industrial waste volumes as manufacturing and agricultural sectors stabilize. Additionally, we will track progress on share-of-wallet expansion and continued debt reduction as key markers of strategic execution.
Quest Resource currently trades at $1.08, in line with $1.08 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
High-Quality Stocks for All Market Conditions
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren't just high-quality businesses. Something is happening with them right now. Elite fundamentals meeting near-term momentum - both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week's Strong Momentum stocks - FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
