Stewart EnterprisesSTEI

Morningstar Rating

Stock Research and Analysis

by Bradley Meeks

Stewart Enterprises operates in a low-growth industry suffering from increased competition and changing consumer preferences toward death care. We believe that the firm has earned a high fair value uncertainty rating and that it does not have an economic Read more

Bulls Say

Roughly 41% of Stewart's properties are located in California, Florida, and Texas. These states are three of the four states with the largest population of those over 65 years old.

The U.S population over age 50 is expected to increase by approximately 2% per year, from 77 million in 2000 to 99 million in 2010. As baby boomers age, demand for death-care services could increase.

Stewart has approximately $2 billion in pre-need backlog sales, which represents a sizable amount of future revenue. Read more

Bears Say

Any substantial decline in the company's trust investments could force the company to fund any shortfall between trust assets and customer deposits.

A customer shift toward lower-cost cremations could hurt Stewart's growth.

Big-box retailers and independent funeral service providers have begun to offer caskets at prices substantially lower than Stewart's, adding to pricing pressure. Read more

Strategy

Stewart looks to increase profitability and fuel growth through both operational improvements and acquisitions. The "best-in-class initiative" seeks to improve field operations by providing managers Read more

Management

Thomas Crawford has served as president, CEO, and a director since March 2007 and brings industry experience to the position. Prior to taking the helm at Stewart, Crawford was the chairman, CEO, and president of The York Group, one of the largest casket Read more

Profile

Founded in 1910, Stewart Enterprises is the second-largest provider of funeral and cemetery products and services in the United States. The firm provides funeral merchandise, Read more

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