Updated 3/26
Service Corporation International, or SCI, probably isn’t a household name for most investors, but it quietly runs one of the steadiest businesses out there. As the largest provider of funeral, cremation, and cemetery services in North America, SCI operates in a space that’s rarely talked about but always relevant. Deathcare isn’t flashy, but it’s dependable—and that reliability makes SCI a name worth watching for long-term dividend investors.
Headquartered in Houston, the company runs a network of funeral homes and cemeteries across the U.S. and Canada. While the industry itself doesn’t often make headlines, the demographics driving it are powerful and consistent. The aging population means a steady demand for SCI’s services, and that kind of built-in stability offers a level of resilience that many businesses can’t match.
Let’s take a closer look at recent developments and what dividend-focused investors might want to know.
Recent Events
SCI’s latest earnings results show a business staying the course. Revenue saw a modest year-over-year increase of 3.5%, and earnings per share climbed 9.4%. It’s not the kind of growth that grabs attention, but it reinforces what SCI is all about—steady, predictable results in an industry that doesn’t swing wildly with the economy.
Management continues to focus on returning value to shareholders. In addition to raising the dividend again, SCI has been active with share buybacks. At the same time, the company is managing its capital carefully. With nearly $945 million in operating cash flow over the past year, it’s able to service its debt and still have enough room to reward shareholders.
That said, the debt load isn’t small. Total debt stands at just under $5 billion, and the debt-to-equity ratio is high. But with stable cash flow and consistent profitability, SCI has enough cushion to manage its obligations without compromising on shareholder returns.
Key Dividend Metrics
📅 Ex-Dividend Date: March 14, 2025
💰 Dividend Pay Date: March 31, 2025
📈 Forward Yield: 1.60%
🧮 Trailing Yield: 1.53%
🔁 5-Year Average Yield: 1.55%
💵 Annual Dividend: $1.28 per share
📊 Payout Ratio: 34%
📆 Dividend Growth Streak: 13 years
Dividend Overview
SCI’s dividend yield is currently sitting at 1.60%, which isn’t high compared to some high-yield sectors. But that doesn’t tell the full story. What’s more compelling is how reliable and well-supported that dividend is. The company’s payout ratio is comfortably in the low 30s, which leaves plenty of room for further growth and insulation from any near-term earnings pressures.
The dividend has become a regular part of SCI’s shareholder return strategy. It’s not just a box to check off; it’s part of a consistent long-term approach. Even in tougher economic conditions, the dividend hasn’t skipped a beat, and SCI continues to nudge it higher year after year.
Dividend Growth and Safety
One of the strongest features of SCI’s dividend is how steadily it has grown. The company has increased its payout for 13 consecutive years. The most recent hike was just under 7%, a continuation of the moderate but consistent upward trend that dividend investors tend to appreciate.
Looking at how safe that dividend is, SCI’s cash flow picture offers reassurance. Levered free cash flow came in at around $475 million over the last twelve months, meaning there’s still a solid amount left over after covering operating needs and interest payments. With a dividend obligation of less than $200 million, the company isn’t stretching itself thin.
Its margins are strong as well—operating margin is just under 25%, and return on equity is over 32%. That kind of profitability gives SCI more leeway to keep delivering for shareholders, even if the overall pace of business slows.
Chart Analysis
Price Action and Moving Averages
Looking at SCI’s chart over the past year, the price has gone through a full cycle, with a sharp move higher through the late summer and fall of 2024, topping out just shy of 90 before retreating. Since then, the stock has pulled back, consolidated, and is now hovering just under 79. It’s been caught between the 50-day moving average (currently sloping downward) and the 200-day moving average, which has just been tested from below.
This kind of price behavior—where the 50-day is turning over and the stock flattens against the 200-day—usually signals indecision. Bulls and bears are locked in a bit of a tug-of-war here, and neither side has taken full control recently.
The golden cross from mid-2024, when the 50-day pushed above the 200-day, fueled that strong uptrend, but now the chart is showing hints of exhaustion. The 50-day is curling down, and the stock is struggling to stay above the 200-day. This could be the early part of a Wyckoff markdown phase unless demand reappears in a meaningful way.
Volume Behavior
Volume has noticeably dried up in recent weeks. Earlier in the cycle—particularly during that strong August–November push—there were some heavy accumulation days with clear volume spikes on up-moves. That kind of action tends to show institutional buying. Since then, the volume profile has been much thinner, with no strong surges on up-days and occasional spikes on sell-offs, which suggests distribution.
There was a brief burst of activity in early February, but it didn’t translate to sustained price movement. That signals short-term interest without conviction. The lack of follow-through after that spike leans more toward weak-handed participation rather than a reaccumulation phase.
RSI Momentum
The relative strength index (RSI) has cooled significantly since peaking during the Q4 rally. It’s now hovering in the middle range—not oversold, not overbought. What stands out is the divergence between price and RSI from December through February. Price made a lower high, while RSI also failed to reclaim previous momentum. This weakening setup in momentum, combined with price stalling under the 50-day, supports the idea that bullish momentum has waned.
For now, RSI is neutral but showing no signs of building strength. That neutral-to-weak posture aligns with the current sideways chop and the lack of strong volume.
Recent Candle Action
The last five candles are telling their own story. There’s a subtle pattern of lower highs with long upper wicks, which hints at consistent selling pressure on any attempt to break higher. Bulls are trying to push the stock above 79–80, but every time they do, sellers show up and cap the move. The lower wicks aren’t particularly strong either, so demand isn’t rushing in to buy the dips. The action feels hesitant, like the market is waiting for a catalyst—or fading into a deeper consolidation.
One candle in particular, the one that pierced above the 50-day but closed below it, stands out. That false breakout followed by weakness is often a sign that the path of least resistance is now shifting to the downside unless buyers step in with force.
Analyst Ratings
📉 Service Corporation International (SCI) was recently downgraded by one research outlet from a “hold” to a “sell” rating as of March 26, 2025. The downgrade appears tied to concerns around slowing momentum and valuation following a relatively flat performance over recent months.
📈 On the flip side, other firms remain positive on SCI. Back in December, one major investment firm raised its price target from $86 to $92 while keeping an “outperform” rating. That move reflected optimism around SCI’s steady earnings growth, strong cash flow, and disciplined capital returns, particularly its ongoing dividend increases and share buybacks.
💼 Another major institution followed a similar path in November, boosting its price target from $87 to $93 and sticking with a “buy” rating. They cited the company’s consistent operating performance, resilient margins, and favorable long-term demographic trends that support demand for its services.
🎯 Overall, the consensus 12-month price target for SCI now sits around $88.50. That’s roughly 10.7% above current trading levels. Among analysts, the highest price target clocks in at $92, with the lowest around $85. The majority view the stock as a “buy,” indicating a generally positive outlook despite the occasional bearish note.
📊 The divergence in ratings seems to hinge on short-term versus long-term perspectives. While one camp is wary of slowing momentum, others continue to see a strong cash-generating business with a wide moat and defensive characteristics that hold up well in uncertain markets.
Earning Report Summary
Strong Finish to the Year
Service Corporation International wrapped up 2024 on a solid note, delivering results that showed the company is still firing on all cylinders. In the fourth quarter, adjusted earnings per share came in at $1.06, which was a meaningful jump from $0.93 a year earlier. That kind of gain doesn’t happen by accident—it came alongside a revenue increase of $37 million, up around 4% from the prior year.
SCI’s business isn’t one that usually surprises, and that’s exactly why these results matter. It’s about consistency and execution, and both were on display this past quarter.
Funeral Segment Keeps Delivering
The funeral side of the business saw another strong stretch. Gross profit was up by about $4 million, and margins also ticked higher, up 40 basis points to just under 22%. That improvement says a lot about how well the company is managing costs. Funeral services aren’t exactly a growth engine, but when you run a tight ship and control the margins, you don’t need flashy top-line growth to make a difference.
Cemetery Business Gets a Boost from Expansion
On the cemetery side, SCI kept its foot on the gas with acquisitions and real estate investments. The company added 26 new funeral homes and six cemeteries during the quarter, expanding its footprint in a space where scale really matters. These additions aren’t just for show—they’re expected to contribute meaningfully to revenue down the road and help SCI strengthen its leadership in the industry.
Cash Flow and Outlook
There was a dip in operating cash flow, mostly tied to legal and restructuring expenses. Still, the company hit its full-year targets for adjusted operating cash flow, showing they’re staying disciplined even when one-off items pop up.
Looking into 2025, SCI is sticking with its long-term growth playbook. The company expects adjusted earnings per share to grow in the range of 8% to 12%. That’s in line with its usual pace and suggests confidence in its ability to keep performing, even in a more uncertain economic backdrop.
Between the solid earnings, expanding portfolio, and steady outlook, SCI continues to show why it’s been a quiet but reliable performer.
Financial Health and Stability
Now, the balance sheet does come with a bit of baggage. SCI’s total debt is substantial, and its debt-to-equity ratio is well above average. At first glance, that might raise concerns. But in context, this level of leverage is intentional. SCI owns a large base of physical assets—cemeteries and funeral homes—and the nature of its contracts provides long-term revenue visibility.
The current ratio is on the low side at 0.52, suggesting limited short-term liquidity. But SCI has always leaned more on recurring cash flow than large cash reserves, and that approach has worked for them. With nearly a billion dollars in annual operating cash flow, the company can manage its obligations while still investing in growth and maintaining its dividend.
This isn’t a bulletproof financial setup, but it’s a durable one, shaped for a business that doesn’t rely on rapid growth or economic tailwinds to stay profitable.
Valuation and Stock Performance
From a valuation standpoint, SCI trades at a forward P/E of just under 21, slightly below its trailing P/E of about 22.7. That’s not exactly a deep value territory, but it’s not stretched either. When you consider the business stability and consistent cash flow, the multiple seems fair.
The PEG ratio comes in around 1.73, which reflects that the market isn’t pricing this stock for aggressive growth—but also isn’t discounting its quality.
Over the past year, SCI’s stock has gained around 7.8%, a bit below the S&P 500, but that’s not unusual for a low-beta name like this. The beta sits at 0.91, meaning the stock tends to move less than the overall market. That’s often a plus for income-oriented investors who are more focused on preserving capital than chasing big gains.
The current share price is hovering near both its 50-day and 200-day moving averages, signaling a period of consolidation. Investors seem comfortable with where the stock is priced, which could set the stage for gradual appreciation if the fundamentals stay solid.
Risks and Considerations
While SCI offers a lot of predictability, it’s not without risks.
First, there’s the debt. High leverage can become a problem if rates keep rising or if refinancing becomes more expensive. Management has done a good job managing the balance sheet so far, but this is a metric to keep tabs on over time.
Then there’s the regulatory landscape. Operating funeral homes and cemeteries involves a maze of local and state regulations. SCI’s size helps it navigate this, but compliance costs and legal risks are always in play.
Another thing to consider is the nature of the business. SCI operates in a very steady but slow-growing industry. It’s unlikely to post explosive growth, and there’s a limit to how much it can expand organically. That’s fine for investors looking for income, but it means capital appreciation may be modest.
Lastly, shifts in consumer behavior—like growing demand for lower-cost cremation services—can affect margins. SCI has adapted well so far, but keeping up with changing preferences remains important.
Final Thoughts
SCI isn’t the kind of stock that makes headlines, and it probably won’t ever be the hottest pick in anyone’s portfolio. But for dividend investors looking for consistency, resilience, and quiet performance, it brings a lot to the table.
Its yield is right in line with historical norms, the payout is well-covered by cash flow, and management has shown a clear commitment to rewarding shareholders. Add in a steady operating business with built-in demographic tailwinds, and you’ve got a recipe for long-term reliability.
While the debt position is something to monitor, the overall financial health, dividend safety, and stable revenue base make SCI a worthy consideration for those looking to round out a diversified income portfolio with something a little different—and a lot dependable.