Public consumer funeral operating companies show stock price growth in first-half of 2024

July 2, 2024/Finance/

The Funeral Director Daily Death Care Index (DCI) which consists of five stocks that deal in Death Care in some way continued to move lower in the 2nd Quarter of 2024 which ended last Friday. As a matter of fact, the only stock in the DCI that moved forward in the 2nd Quarter was Park Lawn Corporation which moved from US$ 12.28 per share to US$ 19.01 per share during the quarter.

Of course, the rise in the Park Lawn Corporation (PLC) stock price is easily attributed to the offer to take the company private by a group comprised of Homesteaders Life Insurance and Birch Hill Equity Partners. That transaction is looking to a July 29 shareholder vote would value Park Lawn Corporation stock at CAN $ 26.50 per share which is equal to US$ 19.35 per share and is, more than likely, the reason PLC stock now trades at a U.S. dollar amount of $19.01 per share.

Even with that price rise in PLC stock because of the proposed buy-out, the five stocks that make up the Death Care Index are down in their aggregate price approximately 1.7% for the 2nd Quarter of 2024 and a total of about 2.4% for the first 6 months of 2024. That compares with a Dow Jones Industrial Average up 3.79% for the first half of the year and the S&P 500 up about 14.5% for the first half of the year.

Of course, all of us have heard of the dominance of the Artificial Intelligence (AI) companies in the recent history of the stock market. And, it is that dominance of AI stocks that is thought to be the reason the markets are hitting all-time highs.

Tom Anderson
Funeral Director Daily

The Death Care Index is comprised of owning one share each of the five public companies with at least some business in death care. Those five companies are Service Corporation International, Carriage Services, Park Lawn Corporation, Security National Financial Corporation (SNFC), and Matthews International. Owning one share each on January 1, 2024, would have shown a value of $154.10 whereas at the end of the first-half of the year that DCI Index was down to $150.02 — a decline of about 2.4%.

What is interesting about that DCI Index number however, is that the three companies engaged predominantly in “consumer” death care services — Service Corporation International, Carriage Services, and Park Lawn Corporation — all have their stock prices up on the half-year. The two companies that engage in businesses that are not directly involved in, or have additional business segments outside of direct consumer funeral, cremation, and cemetery services — SNFC and Matthews International — have negative stock prices on the year and drag the entire DCI down with their numbers.

SNFC has had its stock price slide from $9.00 on January 1, 2024 to $7.99 on June 28 and Matthews International has lost almost 1/3 of its stock valuation in going from $36.65 per share on January 1, 2024, to $25.05 per share on June 28, 2024.

So, if there is a positive sign to all of this stock price movement, maybe it is that the consumer side of Death Care is looking a little more attractive to investors. If you look at the stock price growth during the first-half of 2024 for the funeral and cemetery operating companies — SCI, Carriage Services, and Park Lawn Corporation — they have grown at a cumulative 7.9% rate for HY2024. That would compare favorably, or at least evenly, with the other sectors of the United States economy.

You can see where these three funeral service companies that I’ve dubbed “Consumer Funeral Companies” would land as to stock price return among business sectors in the following chart. I want to point out that this chart is “indicative” and not definite as the other sector returns are taken from this article of June 18 — ten days before the half-year ended.

It’s not only in North America — It’s interesting that there are less public companies in Consumer Death Care Services to follow these days. In the space of the last couple of years the English speaking public markets have lost StoneMore Partners (USA), Dignity plc (Great Britain), and InvoCare (Australia/New Zealand) to private investors who have taken the companies private.

One other public company that we do follow, however, is Propel Funeral Partners of Australia and New Zealand. The trend line is the same for them in the first-half of 2024 as it is for the three North American companies that we just mentioned. The stock price of Propel Funeral Partners is up to $5.76 per share as of June 28 from a January 1, 2024, price of $5.16 per share. . . .that’s an 11.6% increase in just six months.

Here is the website for Propel Funeral Partners.

More news from the world of Death Care: