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Can StoneMor Partners Revive in 2013?

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As 2013 begins, now's a good time to look at the future prospects for the stocks you own. If you don't know where a company's headed in the next year and beyond, then it's impossible to make an informed decision about whether you should add the stock to your portfolio -- or sell it if you already own it.

Today, I'll look at StoneMor Partners (NYSE: STON  ) . The funeral and cemetery company didn't see its stock move much in 2012, but it's hoping to return to profitability and post stronger revenue growth to go with its high dividend yield. Below, you'll learn more about StoneMor Partners's prospects for 2013.

Stats on StoneMor Partners



Average Stock Target Price


Full-Year 2012 EPS Estimate


Full-Year 2013 EPS Estimate


Full-Year 2012 Sales Growth Estimate


Full-Year 2013 Sales Growth Estimate


Forward P/E


Source: Yahoo Finance. NM = not meaningful due to negative earnings estimate.

Will StoneMor Partners get livelier in 2013?
Analysts have opinions about StoneMor Partners that seem to contradict themselves. On one hand, they see the shares vaulting upward by more than 25% based on their target price for the stock. Yet from an operational standpoint, despite rising revenue, they foresee even weaker earnings in the coming year.

Unfortunately, that outlook doesn't match up well with StoneMor's biggest competitors. Carriage Services (NYSE: CSV  ) has soared on expectations that it'll be able to produce not only substantial revenue growth but also a nearly 30% jump in earnings per share in 2013. Stewart Enterprises (Nasdaq: STEI  ) and Matthews International (Nasdaq: MATW  ) can't claim that strong an expected result, but each boasts projected earnings growth in the 8% to 10% range for their respective 2013 years.

When you look at the business on a cash-flow basis, though, StoneMor looks a lot stronger, with figures comparable to those of its peers, except for Service Corp. International (NYSE: SCI  ) and its much higher cash flow figures. The disparity between cash flow and net profit likely comes from the accounting distortions that StoneMor deals with in booking its pre-arranged funeral services contracts.

Even better for StoneMor is the fact that at least for now, the master limited partnership tax structure has survived the fiscal cliff resolution process. With debates on the debt ceiling, sequestration, and other spending measures still on the horizon, MLPs could get threatened again, but for now, the company has surpassed an important hurdle that should help it continue to make its outsized distribution payments.

For 2013, StoneMor needs to find ways to get investors more enthusiastic about its prospects. Otherwise, the stock could continue to languish in relative obscurity.

Click here to add StoneMor Partners to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

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Related Tickers

9/30/2016 4:02 PM
STON $25.04 Up +0.14 +0.56%
StoneMor Partners CAPS Rating: ***
CSV $23.65 Up +0.05 +0.21%
Carriage Services CAPS Rating: ***
MATW $60.76 Up +0.62 +1.03%
Matthews Internati… CAPS Rating: **
SCI $26.54 Up +0.23 +0.87%
Service Corporatio… CAPS Rating: *****
STEI.DL $0.00 Down +0.00 +0.00%
Stewart Enterprise… CAPS Rating: No stars