Service Corp. Intl. stock price target raised to $91 from $86 at Oppenheimer

Service Corporation International (NYSE:SCI) received multiple price target upgrades from Oppenheimer and Raymond James following strong Q2 2025 financial results, which saw adjusted EPS and revenue exceed Street consensus. Oppenheimer's revised outlook, based on an investor field trip to the high-potential Rose Hills Memorial Park, underscores confidence in SCI's sustainable growth momentum, driven by pre-need sales and a resilient free cash flow profile. The company's attractive valuation and recent $0.32 per share quarterly dividend further support the positive analyst sentiment.

Analysis

Service Corporation International (SCI) has garnered positive attention following multiple analyst upgrades and a strong second-quarter 2025 performance. The company reported adjusted EPS of $0.88 on revenue of $1.07 billion, surpassing consensus estimates of $0.85 and $1.05 billion respectively, driven partly by improved commissions in its pre-need funeral services segment. Reflecting this strength, both Oppenheimer and Raymond James raised their price targets to $91 and $90, respectively, while maintaining Outperform ratings. Oppenheimer's confidence is further supported by a site visit to the Rose Hills Memorial Park, a key asset contributing approximately 10% of annual EBITDA. The firm anticipates that a new high-value section, 'The Oaks,' will fuel high price-point sales, sustaining momentum into the second half of 2025 and beyond. The combination of resilient growth, improving free cash flow generation, a P/E ratio of 21.8x, and a newly approved quarterly dividend of $0.32 per share positions SCI as attractively valued in the current market.

Key Decisions for Investors

• Given the dual analyst upgrades and an earnings beat, investors should view the new price targets of $90 and $91 as a strong signal of potential upside from the current trading price of $81.61.
• The sustainability of the growth outlook is heavily dependent on pre-need cemetery sales; therefore, investors should closely monitor this metric in subsequent quarterly reports for validation of the investment thesis.
• For investors seeking defensive growth, SCI's resilient business model combined with an improving free cash flow profile and a committed $0.32 quarterly dividend presents a compelling case for capital allocation.