Seeking Alpha contributiing author Daniel Jones published an article this week titled, “Service Corporation International:  You might want to hold this one until your last breath”.

It is a very interesting article that uses both SCI financial data and United States birth and death data to make a case that SCI, as a company is probably a good investment for the long haul.  The article also makes good use of graphs to tell its story.  You can access the article here.

As always, Funeral Director Daily does not take a particular side of the issues presented other than to present them to you for your own opinions.  Here are some quotes from the article:

• “Service Corporation International remains a dominant player in the US and Canadian funeral and cemetery industry, with strong growth prospects.”

• “SCI’s revenue, profits, and cash flows continue to rise, driven by population growth and increasing demand for death care services.”

• “Unless you expect a world-ending catastrophe, you can expect revenue growth achieved by Service Corporation International to continue for the long haul.”

• “While many countries, like Japan, South Korea, and China, are seeing populations decline, the US continues to see population growth, largely because of immigration.”

Steady Growth of U.S. Population from 1950 to 2024 as shown in the article

The above chart shows the steady population growth in the United States from 1950 to the present.  The article states, “In 2024, it (the U.S. population) hit an all-time high of 345.4 million. That’s up an astounding 22.7%, or 64.9 million, since the year 2000.”

And, here is another chart from the article which shows a continuing growth of population up to 2050 where the hypothesis is that the  United States population will reach 380.8 million —  that’s another 10% increase from 2024.

U.S. population projected growth to 2050 with a projected rise in Median Age. (Image from Seeking Alpha article)

Here is a quote from the article that pertains to the above chart and the idea of the country’s Median Age rising, “It’s unclear what the future holds. We do know that, by 2050, the US population is expected to grow to 380.8 million. The median age is forecasted to grow to about 41.9 years. Currently, the Congressional Budget Office expects an overall decline in the mortality rate. But not everybody agrees with that. The Institute for Health Metrics and Evaluation, for instance, expects issues like drug use to challenge the common narrative that mortality rates will actually decline even as the population of the US continues aging.”

Author Daniel Jones somewhat combines the idea of more deaths with the idea of SCI as North America’s largest Death Care provider to make this statement, “But what is undeniable is that a growth in the overall size of the population is guaranteed to cause the number of deaths to grow. This certainly bodes well for a company such as Service Corporation International.”

Related Article — Here’s a recent article from CBS New’s 60 Minutes Overtime that questions what might happen if the United States continues to see a decline in natural born birth rates.  It is titled “The Trends behind the historically low U.S. Birth Rate” and can be accessed here.

Tom Anderson
Funeral Director Daily

Funeral Director Daily take:  I think Seeking Alpha author Daniel Jones has a good handle on Service Corporation International as a company and on his insights into the United States population dynamics.  Putting those two things together easily leads one to believe that if you are the biggest in a growing industry, as that industry grows with opportunity, your company should enjoy the most growth.

That makes a lot of sense. . . .But I’ve also learned over my life that things don’t always happen in a vacuum.  In this case there are a host of other issues surrounding Death Care choice that it is not as easy as saying 1 + 1 = 2.

While Service Corporation International seems to be making all the right moves in moving in line with society’s Death Care choices — such as making arrangements with at least one of the professions natural organic reduction providers —  there is no guarantee that Death Care clientele will continue to use traditional funeral homes in the same numbers as they do today.  And, if over the next couple of decades SCI cannot move in sync with what consumers want. . . . a larger population (and more deaths) may be no help at all to them.

In my opinion, Death Care is now all about staying relevant with the consumers you are going to serve.  Yes, with the caveat that it is also somewhat geographic location related, the more deaths in your area the more business you should have.  However, I also think Death Care is in a unique position among consumers where habits and methods of use are changing and growth, even with more deaths, will take the right “moves” by existing Death Care businesses to continue to grow.

Disclaimer — The author of this article for Funeral Director Daily is a shareholder of Service Corporation International.

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This article from Yahoo Finance will inform you that the major indexes of the American stock market all closed at record highs last Friday.  During the same week the 3rd Quarter of the year closed and the Funeral Director Daily Death Care Index (DCI) reported a close that indicated a 3.60% increase for the year-to-date.

Below you will see a chart of the individual four stocks that make up the Funeral Director Daily DCI Index and how they have performed in comparison to the major indexes for the Year-to-Date (YTD) 2025 up to the end of the 3rd Quarter on September 30 2025.  You will notice that the DCI trails every sector with the possible exception of Consumer Staples for stock price appreciation for YTD 2025.  One possible reason for this, however, is the small sample size of public companies with at least a portion of their business in Death Care.

As you can see funeral home, cemetery, and crematory operators Carriage Services and Service Corporation International have had positive results, as far as stock price apprecition goes,  so far in 2025 while the other two members of the DCI, Matthews International and Security National Financial Corporation have seen their stock price drop during the year.  It’s difficult to know why, but both Matthews International and Security National Financial have other operations outside of Death Care which may be holding back their stock appreciation in what has been, as noticed by the stock index gains, a rather robust period for public stock investors.

Market Segments performance for YTD 2025 up to September 30.  Source:  LPL Research Factset

How About the Long-Term:  Just for the fun of it I went back to October 3, 2015, and looked at price appreciation (as recorded on Yahoo Finance) of the major indexes and also of the stocks that make up the Death Care Index.  If you had had $10,000 of either the index or a particular stock on October 3, 2015 and still held the index or stock, here’s what those indexes or stocks would be worth today (10/03/2025):

• Dow Jones Industrials Index:  $28,502
• Nasdaq Composite Index:  $50,780
• S&P 500 Index:  $34,992

And, here’s a chart of the Death Care Index values for the that hypothetical $10,000 investment as of October 3, 2015:

Related Information:

Disclaimer:  The author of this article for Funeral Director Daily is a shareholder of Service Corporation International, Carriage Services, and Security National Financial Corporation.

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An article was authored by Seeking Alpha contributor Daniel Jones last week about the largest funeral home and cemetery operator in North America — Service Corporation International (SCI).  As our headline mentions, the title of the article, that you can access here, is “SCI:  A stock to take to the grave”.

Jones uses some information and images from SCI’s 1st Quarter presentation, which you can see here, in giving his analysis and opinion.

As with almost all of the articles from another source that give stock information and suggestions, we will quote some of the thoughts from the article but leave the personal opinions of Funeral Director Daily out of the equation.

Here are some of the quotes Jones uses in making his decisions on SCI:

• “Service Corporation International remains a ‘buy’ due to its industry leadership, stable growth, and strong long-term demographic tailwinds.”
• “The company’s asset clustering strategy and fragmented market offer significant acquisition and cost-saving opportunities for continued expansion.”
• Transition to insurance-funded pre-need contracts should improve margins and sales growth, with management guiding for stronger performance in 2026.”
• Since I (Seeking Alpha author Jones) last wrote about the company in January of this year, in an article in which I reaffirmed the business as a ‘buy’ candidate, the stock is up only 3.8% compared to the 4.3% rise that the S&P 500 has enjoyed. But since I originally rated it a ‘buy’ over nine years ago in April 2016, the stock is up an astounding 248.4%. That comfortably outpaces the 188% rise enjoyed by the S&P 500 over the same window of time. 

A couple of different graphics are shared in the report from the SCI 1st Quarter presentation.  Those graphics make these statements:

• “SCI has 1,985 total locations in North America as of March 31, 2025

• “SCI has a 17% market share in North America with other consolidators listed as 9% in total, and independents have a 74% market share.”

Disclaimer — The author of this article for Funeral Director Daily is a stockholder of Service Corporation International

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If you are an investor in the public stock markets — and most people are now with the advent of IRA’s and 401k plans — you would more than likely be pleased with the growth of your investment had you simply followed an investment strategy of investing in the index of stock market holdings in the Dow 30, the NASDAQ, and the S&P 500.

From the period of January 1, 2024, through the final trading day of the year, December 31, 2024, those market indexes grew by the following percentages:

• Dow 30:       +13.6&
• NASDAQ:    +32.3%
• S&P 500:     +25.2%

If you invested in equal shares of the four publicly traded companies that comprise the Funeral Director Daily Death Care Index (DCI) you would have ended up with a total stock appreciation return of 14.9% for the same time period.  That is down in the last month from December 2, 2024, when Funeral Director Daily published this article showing that at that time the return stood at 24.3% year to date.

However, like many public companies, December 2024 was not kind to the stock prices of Death Care stocks for what could be many reasons, including year-end profit taking.  As a matter of fact, all four companies that comprise the DCI ended 2024 with a lower stock price than they reflected on November 30, 2024.  Those four companies include Service Corporation International (SCI), Carriage Services, Matthews International, and Security National Financial Corporation.  The combined share price of one share of each of those companies stood at $172.38 on November 30, 2024, and had fell to $159.38 on December 31, 2024.

The good news however, is that they started 2024 at a combined price of $138.68 and ended the year at $159.38 — an increase of 14.9% on the year.

If you are wondering how those Death Care companies fared on an individual basis here is a chart:

Three of the four Death Care Index companies had price appreciation in their stock prices during 2024 with Carriage Services gaining a whopping 59.3% on the year.

Tom Anderson
Funeral Director Daily

Funeral Director Daily take:  When I talk to people about the “Death Care Industry” my perception is that most people are bullish about the profession and its movement forward. . . .especially with the fact that the number of deaths per year going forward is virtually guaranteed to rise because of the ageing of the American demographic.

However, balanced with that “positive trend” moving forward is the growing implication that many of the future deceased and their families may choose to spend less than today’s current amounts on their final arrangement services.  I don’t think that potential unknown of “funeral spend” is lost on the investing community.

That “teeter-totter” of thought, if you will, is what I think guides many investor’s decisons about their investment in funeral service.  I also think that may be one of the reasons that investors have been investing in Carriage Services.  If there is an eventual lessening of “funeral spend” in the years to come, those companies who have their debt in check will be in better situations than those that don’t.  Carriage Services has been very forward in talking about how they are getting their debt under control . . . and that may resonate with the investing public.

Here’s what Kathy Shanley, Carriage Services Chief Accounting Officer said of that commitment in the company’s October 31, 2024, Earnings Call, “We paid $15 million towards our outstanding debt this quarter as we continue to drive down our leverage ratio, which is now at 4.3x, down from 5.3x at Q3 of 2023. This reduction in leverage illustrates our commitment to disciplined capital allocation. . . “

Carriage Services had a new CEO named in June 2023 when Carlos Quezada was put in that position.  He was the first CEO to replace founder Melvin Payne who had been in that position since 1991.  I think investors have seen how Quezada and his team have seemed to put in place a patient and deliberate plan to put the company in the best position possible as Death Care moves forward with probable generational changes coming to the business over the next decade and beyond as more options for dispositions, celebrations, and memorializations come to pass.

For decades the mantra in growing funeral service companies has always been about “growing revenue” to increase cash-flows.  Maybe the investing public is changing to a more balanced approach about not only growing revenue but including a “watch your expenses” attitude to grow that cash-flow.

Disclaimer–  The author of this article for Funeral Director Daily is a shareholder in Service Corporation International, Carriage Services, and Security National Financial Corporation.

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Matthews International, which provides memorialization products and cremation solutions among its multi-faceted business segments announced their Fiscal 4th Quarter and Fiscal Year End results last Thursday.  Matthews operates on a fiscal year that ends on September 30 of each year.

While the company had some positive attributes for the quarter such as reducing company debt by $53.8 million, Sales and Adjusted EBITDA for the company both declined for the quarter and the year end in comparison to last year for the same time periods.  As a company, 4th Quarter 2024 Revenues totaled about $446.6 million for the quarter as compared to $480.1 million for 4Q23 — that’s a decrease of about 7%.  For the Fiscal Year ending September 30, 2024, Total Revenues totaled $1.79 billion as compared to FY2023’s number of $1.88 billion — that’s a yearly decrease in sales of about 4.8%.

Total Adjusted EBITDA for the company dropped to $205.1 million for the year compared to 2023’s Fiscal Year total of $225.8 million — a drop of about 9.2% on the year.

Matthews operates in three segments — one of which is the Memorialization Segment which includes cemetery products, caskets, and cremation products.  That segment is the largest, by sales of the three segments and accounted for about 46% of company sales.  It did, however, see a reduction in annual sales from $842 million in FY23 to $829 million in FY24 — a drop of about 1.6%.  The segment’s Adjusted EBITDA almost kept up with last years and can be basically called “flat” for the year — it actually dropped by less than 1%. . . from $163.9 million to $162.5 million.

Here’s what Matthews International President and CEO Joseph C. Bartolacci said in prepared statements in the press release about the Memorialization Segment, “The Memorialization segment reported higher adjusted EBITDA for the current quarter despite lower unit volumes, which were related to a decline in U.S. deaths compared to a year ago. Ongoing cost control efforts combined with improved price realization were the key drivers in the improvement in operating margins. . . . .We expect another solid performance for our Memorialization business in fiscal 2025 as U.S. deaths appear to have generally normalized following COVID and we are projecting continued growth in our cremation-related products sales.” 

You can access the Matthews International November 21, 2024, press release here.

Stock Price Rises:  Interestingly enough, on the news of lower quarterly and annual sales and profits, Matthews International stock price jumped almost 21% on Friday after Thursday’s market closed press release.  Matthews International stock closed at $30.84 per share after opening that day at $25.49.

It’s difficult for one to read into why the value went up over 20% in one day, but the company’s earnings press release did show the SGK Brand Solution Segment gaining sales and the situation of retiring over $53 million of debt.

It could also have to do with the Industrial Technologies Segment of the company and opportunities there.   Here’s an interesting statement that President/CEO Bartolacci included in the earnings press release, “Lastly, as growth opportunities for the Industrial Technologies segment continue to emerge, the Company has been exploring strategies with respect to its portfolio of businesses.   Accordingly, we have retained J.P. Morgan to support the evaluation of potential strategic alternatives.”

Tom Anderson
Funeral Director Daily

Funeral Director Daily take:  This is total speculation on my part but, it’s interesting for me to see the stock price jump to over $30 per share on Friday after not closing at that level since March 2024.  I think the terms “potential strategic alternatives” lead to speculation by many that there could be acquistions on the horizon by Matthews or there could be a divestiture of one of the Matthews segments to come.  Again, from my point of view there is plenty of money in the private equity circles looking to invest.

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In the last calendar year – dating back to October 16, 2023 – Matthews International stock, the parent company of Aurora Casket and Matthews Environmental Solutions (cremation), has dropped over 44% in a world, by contrast, where the Dow Jones Industrials have risen over 25% for the same dates.

A recent (October 6, 2024) article in Seeking Alpha titled “Matthews International: Lawsuit risks loom, but inflection point could be near”, gives an argument to the thought that the worst of the stock price drop may be behind the company.  Funeral Director Daily will give some quotes from the article and then let you read the article here and decide for yourself on the status of the company.

You may or may not know that Matthews International is a consolidated company with three distinct segments — Industrial Tehnologies, Memorialization, and SGK Brand Solutions.  As you can understand, most of our readers are interested in the Memorialization Segment.

Here’s a few quotes from the Seeking Alpha article authors:

• “Matthews International faces challenges due to an outstanding Tesla lawsuit casting a pall, but historically low stock levels present a potential buying opportunity as operating metrics may improve.”

• “The company’s memorialization business shows promise with expected Q4 improvements, lapping declining death rates and tough comparisons.”

• “Industrial technology struggles with stalled EV battery equipment orders . . . “

• “Cost-saving measures and strategic acquisitions aim to improve profitability. . .” 

• “Matthews International  is a stock we’ve covered for some time now. We’ve had successes with it, but the latest run for the stock has been difficult. The major news has been a Tesla  lawsuit against Matthews, looking for an injunction against the company to stop it from monetizing allegedly stolen “trade secrets” that hadn’t been specified.”

• “Memorialization is a cash cow, and with significant declines in the stock, we are beginning to get to prices where that cash cow will be downside protection.”

• “We also believe there is scope for improvements once again in industrial technology between the new product launch and the outstanding orders.”

Related Article — Matthews International completes Senior Notes offering.  PR Newswire

Here is the website for Matthews International

Here is the website for the Matthews International Memorialization Segment

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