Matthews International continues to lead Death Care Index companies in 2023

May 30, 2023/Business, Finance, Products/

All three major indexes of the U.S. stock market, the Nasdaq Composite, the S&P 500, and the Dow Jones Industrials grew by 1% or more on Friday. That convinced me that, over the long weekend I should take a look at how the public companies that deal with Death Care have fared for 2023.

The Funeral Director Daily Death Care Index (DCI) which features five public stocks with at least a portion of their business in the funeral and/or cemetery business consists of these companies: Service Corporation International, Carriage Services, Park Lawn Corporation, Matthews International, and Security National Financial Corporation. As a total owning one share of stock in each of those companies would have pegged the DCI value at $153.53 on January 1, 2023, and it would have been worth $156.99 last Friday — a Year to Date increase of 2.3% for the index.

What I found, however, is that Matthews International has continued to greatly outgrow the others in stock value year -to -date with an increased stock price of 29.6% since January 1, 2023. On January 1, 2023, Matthews International stock opened at $30.44 per share and as of last Friday each share was selling for $39.45. . . . a 29.6% increase.

The only other DCI stock that has showed positive growth year -to-date for 2023 is Security National Financial Corporation — their stock has increased 6.0% since the turn of the new year going from $7.30 per share in value then to $7.74 per share in value as of May 26.

Interestingly enough, for those of us who know Matthews International because of their work in the death care business with brands like Matthews Environmental Solutions (Cremation Equipment), Aurora Casket, and Matthews Cemetery products, it is, more than likely, not those products leading to an increase in the company’s market cap. It is their unit known as Matthews Industrial Technology that seems to have excited investors.

A few years ago, Matthews International took a step into the energy storage business and it looks like that step has brought renewed investor energy to the company.

Here’s what was reported in their 2nd Quarter (fiscal year) 2023 report last month, “For the fiscal 2023 second quarter, our Industrial Technologies segment reported an increase of $47.4 million, or 60.6%, in sales from the same quarter a year ago. Higher sales for our energy storage solutions business and the acquisitions of Olbrich GmbH and R+S Automotive GmbH (August 2022) were the significant contributors to this increase. Our energy storage solutions business continues to grow and interest in our offerings is increasing. Our Industrial Technologies segment is on track to approach sales of $500 million for fiscal 2023, more than double its sales of $228.5 million three years ago (fiscal 2020).”

In comparison, here’s what the same press release said of their Memorial segment, “Our Memorialization segment also reported sales growth for the current quarter despite a significant decline in U.S. casketed deaths. The increase for the current quarter primarily reflected growth in sales of cemetery memorial products and mausoleums, improved price realization, and the acquisition of Eagle Granite Company (February 2023). These increases were partially offset by lower casket unit volume reflecting the lower death rates.”

The Industrial Technologies segment of Mathews International is growing by leaps and bounds, they have recorded, according to the 2Q 2023 report, $237 million in sales(up from $152 million in the same period in 2022) in their half-year 2023 sales. However, that is only a little over half of what the Memorialization segment reported for the same time period — $429 million. So, while Memorialization is, at present, the leading sales segment at Matthews, if the current trend continues look for the Industrial Technology segment to pass them in the next few years.

To learn more about Matthews International’s Industrial Technologies segment you can click here.

To learn more about Matthews International’s Memorialization segment you can click here.

Here is an Investor Presentation from Matthews International dated May 9, 2023. In it they point to their Memorialization segment as a platform that: