Casella Waste Systems enters its Q1 2026 earnings call today with short sellers quietly retreating — a notable shift ahead of a print that follows a sharp post-earnings drawdown last quarter.
Short interest has fallen decisively in the weeks before the report. At 6.2% of free float, it is now at its lowest level in over a month, down nearly 9% on the week. The borrow market reinforces that de-escalation. Cost to borrow is a negligible 0.46% — cheap and stable for months — and the lending pool is far from stretched, with availability running well above the levels that typically signal a crowded short. The ORTEX short score has also eased from 58 in mid-April to 53.7, reflecting a market where bears have been pulling back, not piling in.
Options tell a more cautious story. The put/call ratio is running at 1.37, nearly double its 20-day average of 0.74, pointing to heavier demand for downside protection into the release. That defensiveness lands in context: CWST fell more than 8% on the day and 8% over the following five sessions after its Q4 report in February — a reaction that has clearly left some investors wanting a hedge this time around. The stock closed Thursday at $79.25, down 5.5% on the week despite a 1.5% bounce on the final session, and is trading roughly 26% below UBS's Buy-rated target of $130.
The bull-bear debate on Casella is a familiar one for environmental services names. Bulls point to a resilient regional franchise in solid waste collection, recycling, and organics, with the Western segment anchoring revenue and long-term resource-management demand providing a structural tailwind. Bears counter that the company's concentration in New England exposes it to regional economic softness, and that fuel and recycled commodity price swings can erode margins quickly. On valuation, EV/EBITDA has eased to 12.4x over the past 30 days — modestly cheaper than a month ago — while a trailing PE of 62x leaves limited room for a miss. The analyst consensus carries a mean price target of $112.80, well above the current price, though the most recent moves from UBS in March and JP Morgan in February were target cuts rather than raises, suggesting the Street is recalibrating rather than endorsing the current level.
One institutional wrinkle: BlackRock added more than 4.5 million shares in Q1, lifting its stake to 14.3% — a meaningful build that gives the bull case a credible anchor. Insider activity ran the other direction, with the CEO, CFO, President, and several other officers all selling small but coordinated lots in March at prices around $87–$90 — well above today's level.
The print will test whether Casella's volumes and pricing held up through a softer macroeconomic patch in New England, and whether management's margin guidance can narrow the gap between a 62x earnings multiple and the fundamentals required to justify it.
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