Financial Performance - For the quarter ended June 2025, Service Corp. reported revenue of $1.07 billion, reflecting a 3% increase year-over-year [1] - Earnings per share (EPS) for the quarter was $0.88, up from $0.79 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $1.05 billion by 1.48%, while the EPS surpassed the consensus estimate of $0.84 by 4.76% [1] Key Metrics - Total comparable funeral average revenue per service was $5,807, slightly above the two-analyst average estimate of $5,762.86 [4] - The number of funeral services performed was 87,014, exceeding the two-analyst average estimate of 86,839 [4] - Cemetery revenue reached $474.1 million, surpassing the estimated $471.26 million by three analysts, representing a 1.3% increase compared to the year-ago quarter [4] - Funeral revenue was $591.4 million, exceeding the estimated $578.6 million by three analysts, marking a 4.5% increase year-over-year [4] - Gross profit from cemetery services was $155.5 million, above the estimated $154.19 million, while gross profit from funeral services was $116 million, exceeding the estimate of $106.85 million [4] Stock Performance - Shares of Service Corp. have returned -7.4% over the past month, contrasting with the Zacks S&P 500 composite's +3.4% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Viewpoint - Service Corp. (SCI) reported quarterly earnings of $0.88 per share, exceeding the Zacks Consensus Estimate of $0.84 per share, and showing an increase from $0.79 per share a year ago, representing an earnings surprise of +4.76% [1][2] Financial Performance - The company posted revenues of $1.07 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.48%, compared to $1.03 billion in the same quarter last year [2] - Over the last four quarters, Service Corp. has exceeded consensus EPS estimates three times and topped consensus revenue estimates four times [2] Stock Performance and Outlook - Service Corp. shares have declined approximately 4.7% since the beginning of the year, while the S&P 500 has gained 8.3% [3] - The company's current consensus EPS estimate for the upcoming quarter is $0.83 on revenues of $1.04 billion, and for the current fiscal year, it is $3.77 on revenues of $4.28 billion [7] Industry Context - The Funeral Services industry, to which Service Corp. belongs, is currently ranked in the top 37% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Service Corp.'s stock performance [5][6]

Group 1 - Carriage Services, Inc. plans to release its second quarter 2025 results on August 6, 2025, after market close [1] - A conference call to discuss the earnings will be held on August 7, 2025, at 8:00 a.m. Central Time [2] - The company operates 159 funeral homes across 25 states and 28 cemeteries in 10 states as of June 30, 2025 [3] Group 2 - The conference call will be accessible via phone or live webcast [2] - An audio archive of the call will be available on the company's website after the event [3] - Carriage Services is recognized as a leading provider of funeral and cemetery services and merchandise in the United States [3]

Group 1 - Service Corporation International (SCI) will release its financial results for Q2 2025 on July 30, 2025 [1] - A conference call to discuss the earnings will take place on July 31, 2025, at 8:00 a.m. Central Time [1] - The conference call can be accessed via dial-in numbers or through a live webcast on SCI's website [1] Group 2 - SCI is North America's leading provider of funeral, cemetery, and cremation services, serving over 600,000 families annually [2] - As of June 30, 2025, SCI operates 1,485 funeral service locations and 498 cemeteries across 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico [2] - The Dignity Memorial® brand is recognized for its professionalism and compassion in providing a range of services from simple cremations to personalized remembrances [2]

Group 1 - Investors in Matthews International Corporation (MATW) should monitor the stock due to high implied volatility in the options market, particularly the Dec 19, 2025 $12.50 Call option [1] - Implied volatility indicates market expectations for significant price movement, suggesting potential upcoming events that could lead to a rally or sell-off [2] - Matthews International currently holds a Zacks Rank 4 (Sell) in the Funeral Services industry, which is in the bottom 10% of the Zacks Industry Rank [3] Group 2 - No analysts have increased earnings estimates for Matthews International in the last 30 days, with one analyst revising the estimate downward, reducing the Zacks Consensus Estimate from 41 cents to 33 cents per share [3] - The high implied volatility may indicate a developing trade opportunity, as options traders often seek to sell premium on such options to capture decay [4]

Summary of Service Corporation International (SCI) Conference Call Company Overview - Service Corporation International (SCI) is the largest operator of funeral homes and cemeteries, owning approximately 1,500 funeral homes and 500 cemeteries, generating around $4.5 billion in revenue and approximately $1.4 billion in EBITDA annually [4][9][11]. Industry Dynamics - The company has experienced a "COVID pull forward effect," where an additional 130,000 funeral services were performed during the pandemic, leading to a normalization period with flat funeral volumes expected in the near term [6][7]. - Long-term growth is anticipated due to demographic trends, particularly the aging baby boomer generation, which is expected to create a tailwind for the industry in the next four to five years [8][10]. Financial Performance - Q1 volumes were up by 1.8%, but the company remains cautious about annual guidance due to potential volume pull forward effects from flu season [13][14]. - A backlog of deferred revenues amounts to $16 billion, which is four times the annual revenues, indicating future demand for services [9]. Sales and Revenue Streams - The company has transitioned to a new insurance vendor, improving commission rates from the high 20% range to the mid-30% range, which is expected to enhance cash flow and revenues [19][20]. - Cemetery sales production is approximately $1.4 billion annually, with 85% of sales being under $80,000, which may be affected by macroeconomic conditions [26][29]. Macroeconomic Considerations - The company has not yet seen a reduction in consumer propensity to transact, but discretionary spending could be impacted by rising costs of living [29][30]. - The company feels confident about its supply chain management and long-term contracts, which mitigate tariff exposure [42][47]. Margin Expansion - Both funeral and cemetery segments have a fixed cost structure of 60% to 70%, allowing for significant margin expansion as throughput increases [49][51]. - Current funeral margins are around 20-21%, with potential to reach mid-20s as demographics shift [52]. Acquisition Strategy - SCI typically spends $100 million annually on acquisitions, with a target range of $75 million to $125 million. The company is disciplined in its acquisition strategy, focusing on long-term relationships with independent operators [55][57]. - The company is opportunistic in real estate purchases, looking for suitable land for new funeral homes and cemeteries [59][60]. Long-term Outlook - The company expects to grow pre-need cemetery sales in the low to mid-single digits, with a long-term outlook of mid-single-digit growth as demographics favor the industry [35][38]. - The impact of the baby boomer generation is anticipated to positively affect both funeral and cemetery services in the coming years [50][52].

Core Insights - Service Corporation International (SCI) reported strong first-quarter 2025 results, with both revenue and earnings exceeding expectations, indicating robust performance in the funeral segment [1][2]. Financial Performance - Adjusted earnings per share were 96 cents, surpassing the Zacks Consensus Estimate of 90 cents, and increased from 89 cents in the prior year, reflecting a 7.9% year-over-year growth [2]. - Total revenues reached $1,074.2 million, a 2.8% increase from $1,045.4 million in the same quarter last year, also beating the consensus estimate of $1,054 million [2]. - Gross profit rose 6.3% to $291.4 million, with gross margin expanding by 90 basis points to 27.1% [3]. Segment Performance - **Funeral Operations**: Total funeral revenues were $639.5 million, exceeding the consensus estimate of $607.3 million, and up from $604.7 million in Q1 2024. Gross profit in this segment increased 16.8% to $154 million, with gross margin improving by 230 basis points to 24.1% [5]. - **Cemetery Operations**: Total cemetery revenues were $434.7 million, slightly below the consensus estimate of $446.4 million, and down from $440.6 million in the previous year. Gross profit decreased 3.4% to $137.4 million, with gross margin declining by 70 basis points to 31.6% [10]. Operational Metrics - The number of funeral services performed increased to 97,854 from 94,366 in the prior year, with average revenues per service rising to $5,748 from $5,608 [5]. - Comparable funeral services performed grew 1.8% to 95,624, while comparable cemetery results showed core revenues decreased 2.5% to $397.7 million [7][11]. Financial Health - As of the end of the quarter, the company had cash and cash equivalents of $227.2 million, long-term debt of $4.74 billion, and total equity of $1.65 billion [13]. - Net cash provided by operating activities was $311.1 million, with total capital expenditure amounting to $78.2 million [14]. Guidance - For 2025, SCI maintains its guidance for adjusted earnings per share at $3.70-$4.00, aligning with its long-term growth framework of 8% to 12% [15]. - Total capital expenditure for 2025 is projected at $315 million, with allocations for capital improvements, cemetery property development, and digital investments [17].

Financial Data and Key Metrics Changes - Total revenue for the first quarter was $107.1 million, an increase of $3.6 million or 3.5% compared to the same quarter last year [8] - GAAP net income was $20.9 million, an increase of $13.9 million or 200.1% year-over-year [21] - Adjusted diluted EPS for the first quarter was $0.96 per share, an increase of $0.21 or 28% compared to the prior year quarter [12] Business Line Data and Key Metrics Changes - Total funeral operating revenue was $69.1 million, an increase of $3 million or 4.6% year-over-year, driven by a 1.8% increase in average revenue per contract and a 2.4% increase in admin volume [8][9] - Total cemetery revenue reached $27.9 million, an increase of $1.5 million or 5.8% [10] - Financial revenue was $7.4 million, an increase of $613,000 or 9.1%, primarily from preneed insurance funeral sales [11] Market Data and Key Metrics Changes - The company observed a shift in flu season affecting volume, with a positive variance of 7.7% compared to the first quarter of the previous year [9] - The preneed cemetery growth rate is expected to be between 10% to 20% for the year [10] Company Strategy and Development Direction - The company is focused on disciplined execution and strategic initiatives, including the implementation of the Trinity system and supply chain optimization [15][16] - The company aims to maintain its current guidance while monitoring economic conditions, with potential adjustments based on performance in the second quarter [14][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's momentum and the strength of its financial strategy, despite broader economic uncertainties [13][14] - The company plans to reinvest proceeds from divestitures into higher quality EBITDA-producing businesses, with expectations for acquisitions in the second half of the year [41][43] Other Important Information - Adjusted consolidated EBITDA for the first quarter was $32.9 million, a decrease of $653,000 or 1.9% [11] - Overhead expenses decreased to $15.3 million from $19.4 million in the prior year, with adjusted overhead as a percentage of revenue at 14.3% [24][25] Q&A Session Summary Question: How was March and April performance? - Management indicated that momentum has continued strongly from January through April, primarily due to volume increases [28][29] Question: Does the strength year-over-year suggest the COVID hangover is behind? - Management noted it is challenging to forecast but believes this year will level up and potentially increase volume moving forward [30][32] Question: What is attributed to the decline in preneed and terming rates sold? - Management attributed the decline to delays in available inventory at premier cemeteries rather than discretionary spending [34][36] Question: What are the expected proceeds from property monetization in Q2? - Expected proceeds from property monetization in Q2 are around $6 million, which is factored into guidance [62][63] Question: How does the company plan to react in a recessionary environment? - Management expressed confidence in the resilience of the industry and plans to accelerate lead generation programs to maintain growth [55][57]

Financial Data and Key Metrics Changes - For the first quarter, total revenue was reported at $107.1 million, an increase of $3.6 million or 3.5% compared to the same quarter last year [9] - GAAP net income for the first quarter was $20.9 million, an increase of $13.9 million or 200.1% [22] - Adjusted diluted EPS for the first quarter was $0.96 per share, an increase of $0.21 or 28% compared to the prior year quarter [13] - Adjusted consolidated EBITDA was $32.9 million, a decrease of $653,000 or 1.9% [12] Business Line Data and Key Metrics Changes - Total funeral operating revenue was $69.1 million, an increase of $3 million or 4.6% year-over-year, driven by a 1.8% increase in average revenue per contract and a 2.4% increase in admin volume [9] - Total cemetery revenue reached $27.9 million, an increase of $1.5 million or 5.8% [11] - Financial revenue was $7.4 million, an increase of $613,000 or 9.1%, primarily from preneed insurance funeral sales [12] Market Data and Key Metrics Changes - The company observed a shift in flu season, impacting volume expectations, with a positive variance of 7.7% compared to the first quarter of the previous year [10] - The preneed cemetery growth rate is expected to be between 10% to 20% for the year [11] Company Strategy and Development Direction - The company is maintaining its current guidance while monitoring economic conditions, with plans to potentially raise guidance if momentum continues [14][15] - The Trinity system is in Phase one of implementation, focusing on back office systems, with Phase two expected to begin in the third quarter [16] - The company is excited about the rollout of its express funeral funding partnership, aimed at improving family financial flexibility and unlocking new sales potential [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's momentum and the strength of its financial strategy, despite broader economic uncertainties [14][19] - The company is focused on operational excellence and innovation to create lasting value for shareholders [20] Other Important Information - Cash provided by operating activities for the quarter was $13.8 million, down from $19.7 million in the prior year [23] - The company ended the quarter with a maintained leverage ratio of 4.2 times, down from 5 times [24] Q&A Session Summary Question: How was March and April performance? - Management indicated that momentum has continued strongly from January through April, primarily due to volume increases [30][31] Question: What is the outlook for preneed and terming rates sold? - Management noted that while there was a decline in preneed property rights sold, they expect a return to normal growth rates starting in the second quarter [34][35] Question: What are the expected proceeds from property monetization in Q2? - Management estimated around $6 million in proceeds from property sales in Q2, which is factored into guidance [56] Question: How does the company plan to react in a recessionary environment? - Management expressed confidence in the resilience of the industry, noting that demand remains stable even during economic downturns [51][52] Question: What cost-saving measures are currently in place? - Management highlighted ongoing supply chain initiatives and fleet management as key areas for cost savings [47][48]

Financial Data and Key Metrics Changes - The company reported adjusted earnings per share of $0.96 for Q1 2025, an increase from $0.89 in the prior year, reflecting a growth of approximately 7.9% [6][7] - Total comparable funeral revenue increased by over $23 million, or about 4%, compared to the prior year quarter [8] - Funeral gross profit increased by about $21 million, with the gross profit percentage rising by 240 basis points to over 24% [10] Business Line Data and Key Metrics Changes - Comparable core funeral revenue increased by $18 million, or about 4%, driven by a 2.5% growth in average revenue per service and a 1% increase in services performed [8] - Preneed funeral sales production decreased by $32 million, or about 10%, primarily due to the transition to a new insurance provider [11] - Comparable cemetery revenue decreased by $8 million, or about 2%, with a core revenue decline of $10 million attributed to lower recognized preneed property revenue [12][13] Market Data and Key Metrics Changes - The company anticipates flat to slightly down funeral volume compared to 2024, with average revenue per case growing at inflationary rates [15] - Preneed cemetery sales production is expected to grow in the low single-digit percentage range, resulting in cemetery revenue growth of about 1% to 2% [16] Company Strategy and Development Direction - The company is transitioning from a trust to an insurance-funded preneed model, which is expected to stabilize and grow in the latter half of 2025 [12][16] - The company confirmed its normalized earnings per share guidance range of $3.7 to $4 for 2025, representing a midpoint of 9% year-over-year growth [15] - The focus remains on managing inflationary costs while maintaining gross margin percentages in the 32% to 33% range [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sales pipeline, indicating a strong outlook for the remainder of the year despite external pressures [34][37] - The company is aware of macroeconomic pressures but believes that its products are viewed as essential, which may mitigate trade-down effects during economic downturns [90] - Management expects preneed funeral sales production to normalize later in 2025, with a projected $1.2 billion in production, which is 27% higher than 2019 levels [16] Other Important Information - The company generated adjusted operating cash flow of $316 million in the quarter, exceeding expectations and showing a substantial improvement over the prior year [22] - Capital investments totaled $95 million, with $67 million allocated to maintenance capital and $13 million to growth capital [23][24] - The company returned $176 million to shareholders through dividends and share repurchases, repurchasing approximately 1.7 million shares at an average price of $79 [24] Q&A Session Summary Question: Can you discuss the cemetery preneed sales production being down? - Management noted that large sales were worse than core production, but they expect a strong pipeline moving forward, with April showing good sales [32][34] Question: How do you view the impact of tariffs on costs? - Management indicated that they have long-term contracts that protect against immediate impacts and do not expect material changes to guidance due to tariffs [40][44] Question: What drove the increase in funeral volume in Q1? - Management attributed the increase to slight market share growth and the effects of their pre-need program, despite quarterly volatility [48][50] Question: What is the outlook for preneed funeral volume transitioning to insurance? - Management expects the transition to insurance to yield higher premiums in the future, with a target of returning to growth rates of 3% to 5% by 2026 [62][65] Question: How does the company view the impact of M&A on earnings and volumes? - Management indicated that M&A could contribute 1% to 3% to growth, depending on the timing and nature of acquisitions [92]