An Opinion on StoneMor Partners

An opinion from Seeking Alpha recently came out on one of Funeral Director Daily’s Death Care Index (DCI) stocks, namely StoneMor Partners.  The article is a really good read and goes into quite some detail on what has been happening with the company in the past six months.

According to the article, the company has a market capitalization of about $234 million and has more than $316 million in debt.  It also notes that the company stock has dropped over 68% in the past six months – currently trading at or near its all-time low.

It also states that StoneMor’s Senior Management team consisting of the CEO, COO, and CFO has, or are planning to leave and the company has lost more than 200 employees.

Finally, it is reported that StoneMor’s credit risk has been lowered including a statement from Moody’s that reads in part “. . . sales force changes could lead to a weaker than anticipated financial performance, driving the revision of the rating outlook to negative from stable.”

Funeral Director Daily take:  I’ve been a stockholder of StoneMor, as well as many of the DCI stocks, for some time.  I’ve always wondered about StoneMor’s commitment to operations.  By that I’ve noticed that they, at least publicly,  put a lot of emphasis on the pre-need sales and don’t seem to put much, or I at least have miss it,  emphasis on operational management.  Maybe that is just the modus operandi of a business with over three times the cemeteries than it has funeral homes — 316 to 100.  i.e. pre-need cemetery sales lead to funeral services?? Do they??

The article surmises that the company may be a good high-yielding value investment but investors should also focus on risk and stability.  We agree.[wpforms id=”436″ title=”true” description=”true”]

 

 

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