Casella Waste Systems’ (CWST) Essential Services Support Resilient Growth Despite Near-Term Concerns

Fred Alger Management, an investment management company, released its third-quarter 2026 investor letter for “Alger Weatherbie Specialized Growth Fund”. The letter can be downloaded here. U.S. equities edged higher in Q3 (S&P 500 +2%) in the quarter, supported by solid earnings and AI investments, though narrow market breadth left roughly 60% of index stocks in negative territory. Macro headwinds intensified as Middle East conflicts pushed oil above $100/barrel, driving Energy gains while elevated interest rates weighed heavily on Utilities. Despite AI spending scrutiny, the fund sees expanding opportunities for productivity adopters beyond core hardware suppliers, alongside disruption risks for legacy models. Against this backdrop, Class A shares returned -16.00% (without sales charge) and -20.43% (with sales charge) vs. -10.35% for the Russell 2500 Growth Index, with Consumer Discretionary and Materials aiding relative results while Industrials and Health Care detracted. Also, check the Fund’s top five holdings to see its best picks for 2026. In its Q3 2026 investor letter, Alger Weatherbie Specialized Growth Fund highlighted Casella Waste Systems, Inc. (NASDAQ:CWST). Casella Waste Systems, Inc. (NASDAQ:CWST) is a solid waste services provider offering collection, transfer, disposal, recycling, and resource management solutions. On October 27, 2026, Casella Waste Systems, Inc. (NASDAQ:CWST) closed at $93.71 per share with a market capitalization of $5.96 billion. Casella Waste Systems, Inc. (NASDAQ:CWST) shows a YTD pullback of 4.32%, trading within a 52-week range of $74.05 to $107.96. Alger Weatherbie Specialized Growth Fund stated the following regarding Casella Waste Systems, Inc. (NASDAQ:CWST) in its Q3 2026 investor letter: “Casella Waste Systems, Inc. (NASDAQ:CWST) provides waste collection, disposal, recycling, and related services to residential and commercial customers across the eastern United States. We believe the company benefits from recurring demand for essential waste services, strong pricing power, and opportunities to expand through acquisitions in markets where disposal capacity is limited. Shares detracted from performance during the quarter despite solid revenue growth, higher landfill volumes, and continued acquisition activity. Investor concerns centered on weaker profit margins, as elevated fuel costs and recently acquired operations increased expenses and diluted profitability. The company’s active acquisition strategy also raised questions about how quickly it could integrate new businesses and achieve expected cost savings. Despite these near-term pressures, we remain constructive on Casella’s long-term opportunity given its established regional position, disciplined pricing, and potential to improve acquired operations over time.” [im-yf-promo] Casella Waste Systems, Inc. (NASDAQ:CWST) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held Casella Waste Systems, Inc. (NASDAQ:CWST) at the end of the second quarter, which was 28 in the previous quarter. While we acknowledge the potential of Casella Waste Systems, Inc. (NASDAQ:CWST) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. [/im-yf-promo] Should you invest in CWST now? Casella Waste Systems, Inc. (NASDAQ:CWST) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held Casella Waste Systems, Inc. (NASDAQ:CWST) at the end of the second quarter, which was 28 in the previous quarter. While we acknowledge the risk and potential of Casella Waste Systems, Inc. (NASDAQ:CWST) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Casella Waste Systems, Inc. (NASDAQ:CWST) and that has massive upside potential, check out our report about this cheapest AI stock. See Our Top Pick →Insider Monkey Premium Services In another article, we discussed Casella Waste Systems, Inc. (NASDAQ:CWST) and shared Baron Capital’s views on the company. In addition, please check out our hedge fund investor letters Q3 2026 page for more investor letters from hedge funds and other leading investors. READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years. This article is originally published at Insider Monkey.