Q: Can you comment on the attractiveness of SES and its transition/valuation to more of a waste management company
5i Research Answer:
SES trades at 10x forward earnings and the stock is up nearly 90% over the past year. Per the company's investor deck, the waste management business model should be more attractive compared to the prior energy services model. Waste management offers double the recurring revenue at 80% of total revenue and more diversified, infrastructure based business. It could prove to make SES more attractive overall and the company is cheap, however, the business has needed to divest assets in this transition so there could be some temporary lags on growth. If execution is high, the transition could prove benificial over the long term.