What to Look For From StoneMor

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

On Tuesday, StoneMor Partners (NYSE: STON  ) will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

StoneMor is a player in the funeral and death-services business, from which it has produced substantial returns for investors, largely in the form of dividends. But should investors be worried about the company's ongoing losses? Let's take an early look at what's been happening with StoneMor Partners over the past quarter and what we're likely to see in its quarterly report.

Stats on StoneMor Partners

Analyst EPS Estimate


Year-Ago EPS


Revenue Estimate

$63.59 million

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance.

Can StoneMor Partners see its earnings stay alive and well?
Analysts have cut back on their profit estimates for StoneMor, quadrupling their loss estimates for the first quarter and widening their loss consensus by $0.03 per share for the full 2013 and 2014 years. The stock, though, has done well, rising 12% since late January.

The first thing to realize about StoneMor is that arcane and flexible accounting rules make it important to dig beneath its GAAP earnings. Growth throughout the industry has been substantial, as up-and-coming Carriage Services (NYSE: CSV  ) continued to stay on pace for double-digit sales growth as it rapidly expands its reach. Even well-established player Matthews International (NASDAQ: MATW  ) managed to grow revenue by nearly 14% in the quarter that ended in March, although its earnings fell slightly from the year-ago quarter. Still, StoneMor's sales haven't been able to rise as quickly as its peers, with its previous report including just a 6% gain in revenue.

But StoneMor has made some key progress during the first quarter. Back in March, the company offered 1.6 million partnership units to investors and underwriters, pricing the offering at $25.35 and potential raising about $38 million to pay down its credit facility.

More vital news came last month, when the IRS affirmed StoneMor's eligibility to remain a publicly traded partnership. With the company relying on its partnership status to avoid double taxation at the corporate level, StoneMor investors have to praise the decision given that it should ensure the continued substantial payouts that the partnership makes to its unitholders.

In StoneMor's quarterly report, watch closely for comments that the company makes about the state of competition within the death-services industry. Given the way that StoneMor has been able to sustain its share price while still distributing huge dividends to investors, rivals will be fiercely interested in grabbing up as much of the lucrative business as they can, and StoneMor needs to be prepared to defend its turf and make smart strategic moves of its own to compete.

The best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.

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

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2408661, ~/Articles/ArticleHandler.aspx, 9/27/2016 5:15:55 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 7 hours ago Sponsored by:
DOW 18,094.83 -166.62 -0.91%
S&P 500 2,146.10 -18.59 -0.86%
NASD 5,257.49 -48.26 -0.91%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/26/2016 4:02 PM
STON $24.91 Down -0.09 -0.36%
StoneMor Partners CAPS Rating: ***
CSV $23.63 Down -0.42 -1.75%
Carriage Services CAPS Rating: ***
MATW $59.89 Down -0.59 -0.98%
Matthews Internati… CAPS Rating: **