Barclays has reinstated coverage of GFL Environmental with an overweight rating and a price target of $58, citing a 40% implied upside from the current share price of $41.50. The move follows GFL’s completion of the Secure Waste acquisition, which expands its presence in Alberta’s oil sands region, where Secure Waste’s assets are concentrated.
The analyst, William Grippin, highlighted the strategic alignment of GFL’s expanded operations with higher-margin waste volume growth tied to Canadian oil sands production. This growth is supported by a memorandum of understanding between the Canadian and Alberta governments and five oil sands producers, with Alberta targeting a doubling of oil output over the next 10 to 15 years.
GFL’s second-quarter results showed revenue growth of 16.3% to CAD 1.84 billion, adjusted free cash flow of CAD 237 million, and adjusted EBITDA of CAD 559 million, representing a consolidated margin of 30.4% and a Canadian record of 34%. The company raised its full-year 2026 outlook, attributing the revision to pricing, margin expansion, and cash flow momentum despite elevated diesel costs and softer construction-related volumes.
Barclays’ price target of $58 implies a potential annual capital allocation capacity of up to $500 million for mergers, acquisitions, or share buybacks, an increase from the previous baseline of $1 billion to $1.5 billion. The analyst consensus, as tracked by InvestingPro, aligns with a buy recommendation and an average upside of 24%.
Scotiabank separately raised its price target for GFL Environmental to $56 while maintaining a Sector Outperform rating. The bank also increased its EV/EBITDA multiple estimate to 13.5 times, reflecting improved operational leverage and growth prospects in the waste management sector.
