Stericycle Tumbles to 4-Year Low on Forecast, Accounting Errorby
Stericycle Inc. plunged to a four-year low after the medical-waste management company said it improperly recognized the timing of some 2015 legal costs and forecast earnings that missed analysts’ estimates.
Loss reserves for two litigation matters were recognized improperly, overstating net income by $46.5 million for the first quarter of last year, the Lake Forest, Illinois-based company said in a regulatory filing Friday. Results, meanwhile, understated net for the second and third quarters by $27.4 million and $17.2 million, respectively. The errors didn’t affect results for the full year.
Earnings this year will be $4.68 to $4.75 a share, executives said on a conference call after the close of regular trading Thursday. That fell short of the $4.90 that analysts had predicted, according to estimates compiled by Bloomberg. The company reported second-quarter sales of $891.6 million, trailing the $912.9 million average estimate, while earnings were $1.18 a share, matching predictions.
Stericycle fell 18 percent to $88.02 at 1:10 p.m. in New York, reaching its lowest intraday price since June 2012.
Stericycle helps hospitals, doctor’s offices and drugmakers dispose of medical and hazardous waste, with more than 1 million customers worldwide.