Covanta Holding Corp (CVA)

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Following Jakila the Hun. The timing for this pick seems reasonable because Covanta's price recently dipped after a somewhat disappointing earnings report. Valuation is borderline. Although the price of 2 times book (or 22 times earnings) seems reasonable for a growth company like Covanta, the company has quite a bit of debt that must be paid from future cash flows. BUT- the upside is EXCITING. The company's mission of converting waste to energy makes sense at a very basic level - and surprisingly enough the company has generated decent profits in recent periods. This company could be THE NEXT BIG THING. If so, its high debt levels will be an easily surmountable issue.

Covanta has been growing slowly, and analysts are forecasting more slow growth over the next few years - just ~8-15%. On that basis, even at today's near 52-week low share price, it should market perform or undeperform going forward.

But Covanta is a multinational world leader in turning a major environmental liability - non-recyclable waste - into a major environmental asset: clean energy and greenhouse gas reduction. Assuming it does this in a cost-effective way (I'm not familiar with those details), it qualifies as a member of the greenshift low-hanging-fruit family and ought to thrive not only in any global green revolution, but particularly in a financially constrained one, as we are experiencing now. So, optimistically, I hope to see it grow at 20-30%+. And with analysts estimating $1+ eps by 2010, that would give it a neutral target price of $20-$30+ by then.

Trash to energy-c'mon--this business is fantastic. I have heard that some people are concerned that collections are down--there will always be trash don't be silly...

ibd

Covanta turns garbage to energy in a number of places, including Alexandria, Virginia. Way under-valued, and now in the best possible political environment.

This one is worth watching. I predict not a lot of middle ground with this. Either it's going to pay for your child's college education or you're going to increase your walmart position in the hopes of earning back the money you lost. My gut says that this will take off.

Buying s business that burns trach and converts it into energy for sale is about as good a business as you could own right now. Everyone loves the idea of reducing landfill, and energy has never been more profitable. That along with billionaires like Whitman and Zell putting serious cheese behind this idea, people smarter than most, then you are buying into a perfect storm over the long run assuming management continues to deliver on their story.

good stock have it for over 2 years

canslim screener

This is a great green energy play.

- Lots of insider buying

- 10.94% profit margin

- 20.39% operating margin

- 17.25% ROE

HOWEVER..

Other metrics such as P/E, PEG, price/sales, and debt/equity are not so great.

This explains why many analysts are bearish on CVA. Be careful.

An alternative approach to power generation that is already commercially viable is to get it from garbage, and the leader in waste-to-energy facilities is Covanta. The company operates 32 plants that burn trash and municipal waste to make steam and heat for power generation. Trash haulers pay the Fairfield, N.J., company to take the waste off their hands. This form of renewable energy is especially competitive in places such as New England, where landfill space comes at a premium. Besides, while there may be shortages of oil and natural gas, it's hard to imagine that there will ever be a shortage of a superabundant source of renewable energy such as trash.

The future of energy production from organic matter is in waste products not corn or other crops. Also, Covanta is already a profitable company, unlike so many renewable energy companies that are just getting started

This is the time to really get into some of these companies that are helping to turn our society green. Now the question is is, what companies have a good business model and quality management to lead their company through this downturn in the economy. I think this is a company that can go a long way.

Waste to Power. Need of the hour. This is the mine to explore now.

There is an AMPLE supply of waste! The government will be backing them up with grants to turn crap into good. Buy now!!!

I love Convanta - seem to be a bunch of visionaries with an eye towards environmentalism. Definitely have karma on their side, in the least. Maybe a bit overpriced right now, but it will perform in the long run.

Boy, the 'market's' really ~in the toilet-huh?

Covanta Holding Corp produces energy from landfill waste. The company owns and operates 51 energy production facilities. Operations are world wide, help to diminish greenhouse gases by capturing methane gas and bested the S&P for the year. I expect the demand for more energy world wide to continue to fuel stock growth.