Quest Resource (NASDAQ:QRHC) Issues Earnings Results

Quest Resource (NASDAQ:QRHC) announced its quarterly earnings results on Thursday. The business services provider reported ($0.05) EPS for the quarter, missing the consensus estimate of ($0.04) by ($0.01), Zacks reports. The business had revenue of $64.07 million during the quarter, compared to analyst estimates of $63.55 million. Quest Resource had a negative net margin of 7.07% and a negative return on equity of 13.51%.

Here are the key takeaways from Quest Resource’s conference call:

• Revenue returned to growth: Second-quarter revenue increased 8% year over year to $64.1 million and 4% sequentially, driven by stabilizing industrial volumes, new customer wins, and wallet-share expansions.
• Portfolio diversification is gaining traction: Quest highlighted growth across food service, retail, hospitality, and automotive markets, including nine meaningful wallet-share wins over the past year and four additional wins in the second quarter.
• Operational improvements strengthened cash generation: SG&A declined 11% year over year despite higher revenue, operating cash flow reached $4.5 million, and improved billing, collections, and vendor processes helped reduce working-capital days.
• Debt reduction continued: Quest reduced net notes payable by $4.6 million year to date, including a $2 million voluntary early payment during the quarter, and expects lower interest expense to support further paydown.
• Margins remain under pressure: Gross margin fell to 16.3% from 18.5% a year earlier, primarily because of pressure from select industrial customers; management also cautioned that macroeconomic conditions and elongated sales cycles could remain uneven.

Quest Resource Stock Up 18.1%

Shares of Quest Resource stock traded up $0.23 on Friday, reaching $1.50. 132,240 shares of the company were exchanged, compared to its average volume of 17,356. The stock’s 50 day moving average price is $1.32 and its 200-day moving average price is $1.41. The company has a debt-to-equity ratio of 1.64, a current ratio of 1.28 and a quick ratio of 1.28. Quest Resource has a 1-year low of $0.81 and a 1-year high of $2.41. The company has a market cap of $31.61 million, a P/E ratio of -1.83 and a beta of 0.18.

Institutional Inflows and Outflows

A number of institutional investors have recently added to or reduced their stakes in the company. Bank of America Corp DE grew its holdings in Quest Resource by 36.5% during the 4th quarter. Bank of America Corp DE now owns 15,356 shares of the business services provider’s stock worth $100,000 after acquiring an additional 4,104 shares in the last quarter. Qube Research & Technologies Ltd acquired a new stake in shares of Quest Resource in the 2nd quarter valued at $50,000. Jane Street Group LLC lifted its position in shares of Quest Resource by 91.4% during the 4th quarter. Jane Street Group LLC now owns 27,233 shares of the business services provider’s stock worth $51,000 after purchasing an additional 13,004 shares during the last quarter. Goldman Sachs Group Inc. lifted its position in shares of Quest Resource by 22.8% during the 1st quarter. Goldman Sachs Group Inc. now owns 51,990 shares of the business services provider’s stock worth $135,000 after purchasing an additional 9,647 shares during the last quarter. Finally, Rothschild Wealth LLC acquired a new position in shares of Quest Resource during the fourth quarter worth $274,000. Hedge funds and other institutional investors own 48.16% of the company’s stock.

Analyst Upgrades and Downgrades

A number of equities research analysts have recently issued reports on the stock. Zacks Research raised shares of Quest Resource from a “strong sell” rating to a “hold” rating in a research note on Tuesday, July 7th. Weiss Ratings cut Quest Resource from a “sell (d-)” rating to a “sell (e+)” rating in a research note on Thursday, May 21st. Two equities research analysts have rated the stock with a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat, the company has an average rating of “Reduce” and a consensus price target of $2.25.

Quest Resource Company Profile

Quest Resource Holding Corporation, together with its subsidiaries, provides solutions for the reuse, recycling, and disposal of various waste streams and recyclables in the United States. The company provides disposal and recycling services for motor oil and automotive lubricants, oil filters, scrap tires, oily water, goods destruction, food waste, meat renderings, cooking oil and grease trap waste, plastics, cardboard, metal, glass, mixed paper, construction debris, as well as a large variety of regulated and non-regulated solid, liquid, and gas wastes.