Carriage Services, Inc.

Carriage reported Q1 2026 revenue of $106.1 million, down 0.9% from the prior year, with funeral comparable revenue at $63.3 million, down 4.2%, and comparable cemetery revenue at $29.6 million, up $1.7 million or 6%. Financial revenue was $8.5 million, up 15.7%, adjusted consolidated EBITDA was $33.8 million, up $805,000 or 2.4%, and adjusted EBITDA margin was 31.8%, up 100 basis points. Adjusted diluted EPS was $0.86 versus $0.96 last year; GAAP diluted EPS was $0.84 versus $1.34. For 2026, the company kept full-year guidance unchanged: revenue of $440 million to $450 million, adjusted consolidated EBITDA of $135 million to $140 million, adjusted EBITDA margin of 30.5% to 31.5%, adjusted diluted EPS of $3.35 to $3.55, overhead of 13.5% to 14.5% of revenue, adjusted free cash flow of $40 million to $50 million, and year-end leverage of 3.5x to 4x.

Carlos Quezada framed the quarter as evidence of steadier execution and a stronger operating foundation than three years ago, when he said the company faced higher leverage, fragmented processes and underinvestment. He emphasized disciplined pricing, better systems and data, and a culture of operational excellence as drivers of margin expansion and more predictable sales. His tone was confident and strategic, especially around the 2030 vision and using the ATM program to fund high-return growth and acquisitions selectively.

John Enwright highlighted the tough comparison from last year, including about $4.8 million of revenue tied to businesses divested in 2025. He said adjusted EBITDA of $33.8 million and margin of 31.8% reflected gains from cemetery operations and premium funeral sales, partly offset by about $2.4 million lower comparable funeral EBITDA due to volume pressure. He also noted cash from operations rose $1.1 million, free cash flow was $400,000, adjusted free cash flow was $2.2 million lower due to last year’s special payments, bank leverage improved to 4x from 4.2x, and capex was $3.9 million, including $2.2 million of maintenance and $1.7 million of growth capex. He reiterated that the ATM program is meant to provide flexible funding for acquisitions while keeping leverage within the targeted range.

Analysts focused on the Q1 funeral volume decline, whether revenue growth would return later in the year, and how much the new ATM could support acquisition activity. Management said the weak comp was mostly in January and February, April started slowly, and they expect Q2-Q4 to help offset the Q1 shortfall, aided by normalization after divestitures and ongoing market-share efforts. On M&A, they said the pipeline is robust, one deal is scheduled to close later this month, and they expect significant activity in the back half of the year, potentially exceeding the $5 million to $10 million of revenue assumed in guidance over the next few quarters.