Service Corporation International (SCI)SCI

Service Corporation International (SCI): A Comprehensive Overview

Company Profile:

• History: Founded in 1962, SCI has grown to become the largest provider of funeral, cemetery, and cremation services in North America.
• Core Business: SCI operates in two segments: Funeral and Cemetery Operations and Memorial Products. The former provides funeral services, merchandise, and cemetery property sales. The latter manufactures and distributes memorial products like caskets, urns, and vaults.
• Leadership: SCI is led by CEO Thomas Ryan and a team of experienced executives across various departments.

Top Products and Market Share:

• Funeral Services: SCI holds the largest market share in the US funeral service industry, with over 2,000 funeral homes and cemeteries across 44 states and Canada.
• Memorial Products: SCI operates the largest network of memorial product manufacturing and distribution facilities in North America.
• Market Share: SCI's market share in the US funeral service and cemetery industry is estimated to be around 16%, with significant regional variations.

Total Addressable Market:

• The global funeral and cemetery services market is estimated to be worth over $100 billion, with the US market constituting a significant portion.
• The global memorial products market is estimated to be around $20 billion.

Financial Performance:

• Revenue: SCI's revenue has been steadily increasing over the past few years, reaching $2.6 billion in 2022.
• Profitability: SCI's profit margins have remained relatively stable, with a net income of $371 million in 2022.
• Earnings per Share (EPS): SCI's EPS has grown steadily, reaching $2.60 in 2022.

Dividends and Shareholder Returns:

• Dividend History: SCI has a consistent dividend payout history, with a current annual dividend yield of around 2%.
• Shareholder Returns: SCI's total shareholder returns have outperformed the S&P 500 over the past 5 and 10 years.

Growth Trajectory:

• Historical Growth: SCI has experienced steady organic growth over the past decade.
• Future Growth: SCI's future growth is expected to be driven by acquisitions, expansion into new markets, and increasing demand for cremation services.

Market Dynamics:

• Industry Trends: The funeral and cemetery services industry is experiencing a shift towards cremation and personalized services.
• Demand-Supply: The demand for funeral services is expected to remain stable in the coming years.
• Technological Advancements: Technology is playing an increasingly important role in the funeral industry, with the emergence of online arrangements and virtual memorial services.

Competitors:

• Key Competitors: SCI's main competitors include Carriage Services (CSV), StoneMor (STON), and Dignity PLC (DIGN).
• Market Share: SCI is the market leader, followed by Carriage Services with a market share of around 10%.
• Competitive Advantages: SCI's large network, strong brand recognition, and economies of scale give it a competitive advantage.

Recent Acquisitions:

• 2021: SCI acquired Great Lakes Caring, expanding its presence in the Midwest.
• 2022: SCI acquired The Neptune Society, a leading provider of direct cremation services.
• 2023: SCI acquired Batesville Casket Company, a major manufacturer of caskets and urns.

AI-Based Fundamental Rating:

Overall Rating: 7.5 out of 10

Justification: SCI has a strong financial position, a leading market share, and good growth prospects. However, the company faces challenges from competition and changing consumer preferences.

Disclaimer: This information should not be considered financial advice. Please consult with a qualified financial professional before making any investment decisions.

Sources:

• Service Corporation International Annual Report
• SEC Filings
• Investor Relations website
• Industry reports
• News articles

Additional Notes:

• This document only includes information up to November 2023 and may not reflect current market conditions.
• The AI-based rating is based on publicly available information and may not be entirely accurate.