Service Corporation International (NYSE:SCI) Shares Gap Down on Disappointing Earnings

Key Points

• SCI shares plunged nearly 12%, opening at $72.76 after the company reported quarterly adjusted EPS of $0.97, below analyst expectations of approximately $0.98–$0.99.
• Revenue rose 4.6% year over year to $1.11 billion, slightly exceeding estimates, while operating cash flow increased 18% to $296.8 million. The company maintained its full-year adjusted operating cash-flow midpoint of $1.085 billion.
• SCI declared a quarterly dividend of $0.36, equivalent to a $1.44 annualized payout and a 2.0% yield; analysts remain broadly positive, with a consensus “Buy” rating and a $100.67 target price.

Service Corporation International (NYSE:SCI - Get Free Report) gapped down prior to trading on Thursday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $82.33, but opened at $72.76. Service Corporation International shares last traded at $72.6010, with a volume of 757,387 shares changing hands.

The company reported $0.97 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.99 by ($0.02). Service Corporation International had a return on equity of 34.38% and a net margin of 12.30%. The company had revenue of $1.11 billion for the quarter, compared to the consensus estimate of $1.10 billion. During the same quarter last year, the business posted $0.87 EPS. Service Corporation International's quarterly revenue was up 4.6% on a year-over-year basis.

Service Corporation International Dividend Announcement

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, September 30th. Stockholders of record on Tuesday, September 15th were paid a $0.36 dividend. The ex-dividend date of this dividend was Tuesday, September 15th. This represents a $1.44 annualized dividend and a dividend yield of 2.0%. Service Corporation International's dividend payout ratio is 37.60%.

Key Stories Impacting Service Corporation International

Here are the key news stories impacting Service Corporation International this week:

• Positive Sentiment: Third-quarter revenue rose approximately 5% year over year to $1.107 billion, exceeding the $1.10 billion consensus estimate. Comparable funeral and cemetery preneed sales production increased 6% and 5%, respectively, supporting the company’s underlying demand trends. SCI Third-Quarter Revenue Report
• Positive Sentiment: Operating performance improved year over year: reported diluted EPS increased to $1.03 from $0.84, operating cash flow rose 18% to $296.8 million, and year-to-date dividends and share repurchases totaled $464 million. SCI also maintained its full-year adjusted operating cash-flow midpoint of $1.085 billion. SCI Third-Quarter Operating Results
• Neutral Sentiment: SCI issued fourth-quarter adjusted diluted EPS guidance of $1.10 to $1.20. The maintained cash-flow outlook provides some support, but investors are weighing it against the company’s broader full-year guidance update. SCI Updates Full-Year 2026 Guidance
• Negative Sentiment: Quarterly adjusted EPS was $0.97, below analyst expectations of roughly $0.98-$0.99, even though revenue beat estimates. The combination of the earnings shortfall and a reported reduction to full-year earnings guidance is the primary reason for the negative stock reaction. SCI Q3 Earnings and Revenue Report

Wall Street Analysts Forecast Growth

SCI has been the subject of several research reports. Wall Street Zen raised Service Corporation International from a "sell" rating to a "hold" rating in a research note on Sunday, September 20th. Weiss Ratings raised Service Corporation International from a "buy (b-)" rating to a "buy (b)" rating in a research report on Wednesday, October 21st. Finally, UBS Group lifted their target price on shares of Service Corporation International from $93.00 to $105.00 and gave the company a "buy" rating in a report on Friday, July 31st. Four investment analysts have rated the stock with a Buy rating. According to data from MarketBeat, the stock currently has an average rating of "Buy" and a consensus target price of $100.67.

Insider Activity

In related news, CEO Thomas Ryan sold 253,391 shares of Service Corporation International stock in a transaction that occurred on Friday, July 31st. The shares were sold at an average price of $85.25, for a total value of $21,601,582.75. Following the completion of the sale, the chief executive officer directly owned 1,006,212 shares in the company, valued at $85,779,573. This trade represents a 20.12% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. 3.40% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Service Corporation International

A number of large investors have recently made changes to their positions in SCI. Peterson Wealth Services increased its position in shares of Service Corporation International by 10.5% during the third quarter. Peterson Wealth Services now owns 17,011 shares of the company's stock worth $1,295,000 after acquiring an additional 1,619 shares during the period. Root Financial Partners LLC purchased a new position in shares of Service Corporation International during the third quarter worth about $41,000. GAMMA Investing LLC increased its stake in shares of Service Corporation International by 20.0% during the third quarter. GAMMA Investing LLC now owns 3,204 shares of the company's stock worth $244,000 after acquiring an additional 533 shares during the period. Farther Finance Advisors LLC boosted its stake in shares of Service Corporation International by 5.0% during the 3rd quarter. Farther Finance Advisors LLC now owns 7,527 shares of the company's stock worth $573,000 after acquiring an additional 361 shares in the last quarter. Finally, CX Institutional increased its position in Service Corporation International by 7.3% during the 3rd quarter. CX Institutional now owns 12,345 shares of the company's stock worth $940,000 after purchasing an additional 838 shares in the last quarter. 85.53% of the stock is currently owned by hedge funds and other institutional investors.

Service Corporation International Price Performance

The stock has a market cap of $9.92 billion, a PE ratio of 19.03, a P/E/G ratio of 1.85 and a beta of 0.81. The business has a fifty day moving average of $80.31 and a 200 day moving average of $80.02. The company has a debt-to-equity ratio of 3.32, a current ratio of 0.53 and a quick ratio of 0.49.

About Service Corporation International

Service Corporation International NYSE: SCI is a Houston-based provider of funeral, cremation and cemetery services. The company operates funeral homes, cemeteries and cremation facilities, offering arrangements for traditional funerals, memorial services and cremations, as well as cemetery property, burial services and related merchandise.

SCI serves families primarily in the United States and Canada through a network of locations and a portfolio of brands that includes Dignity Memorial, Funeraria del Angel and Neptune Society.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.