What Happened?
Shares of waste and recycling services provider Quest Resource (NASDAQ:QRHC) fell 32.2% in the afternoon session after the company reported weak fourth-quarter results as revenue barely grew, missing expectations, and EBITDA declined significantly.
The real story was the sharp drop in profitability, with adjusted EBITDA falling by more than half compared to the previous year, weighed down by higher costs, client attrition, and weaker demand in industrial end markets. With earnings pressure mounting, the company announced a 15% workforce reduction and an annualized $3 million cut in operating expenses. The company also named Perry Moss as CEO, signaling a shift in leadership.
Overall, this was a disappointing quarter with little revenue growth and weaker earnings.
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What The Market Is Telling Us
Quest Resource’s shares are very volatile and have had 20 moves greater than 5% over the last year. But moves this big are rare even for Quest Resource and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 7 months ago when the stock dropped 8.2% on the news that the company reported weak second quarter earnings results. Its revenue unfortunately missed and its EPS fell short of Wall Street's estimates. Adjusted EBITDA did come in in line with expectations, which was a bit of a relief. Overall, this was a mixed but weaker quarter for Quest Resource.
Quest Resource is down 58.8% since the beginning of the year, and at $2.62 per share, it is trading 75.4% below its 52-week high of $10.66 from May 2024. Investors who bought $1,000 worth of Quest Resource’s shares 5 years ago would now be looking at an investment worth $1,588.
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