Predicting GFL will turn down private equity buyout, JPMorgan analysts tell investors to short stock

By the Editorial Team · Monday, October 26, 2026

GFL Environmental Inc. is considering private equity acquisition offers exceeding US$20 billion, but JPMorgan analysts doubt a deal will go through and have advised short selling its shares. Meanwhile, JPMorgan favors U.S.-based Casella Waste Systems, expecting its stock to rise due to activist investor pressure and potential takeover interest, recommending a long position on Casella alongside a short on GFL.

GFL Environmental Inc., Canada’s largest waste management company, is currently weighing acquisition offers from private equity firms, but analysts at JPMorgan Chase & Co. have expressed skepticism that a deal will materialize. The company’s board initiated a strategic review in July after receiving unsolicited interest to take the firm private, with potential valuation offers exceeding US$20 billion. However, JPMorgan analysts believe GFL is unlikely to accept these offers and have advised hedge fund clients to short sell GFL shares.

Since the announcement of the review, GFL’s stock price has risen about 18 percent, closing recently around US$45.56 on the New York Stock Exchange, resulting in a market capitalization near US$19.86 billion. Despite this increase, JPMorgan’s target price remains at US$42, and analysts warn that if the take-private deal falls through, GFL shares could decline further due to the company’s higher leverage compared to peers.

GFL’s quarterly financial results, expected this week, might provide updates on the negotiations with private equity suitors. Founder and CEO Patrick Dovigi has described the offers as preliminary and unsolicited.

In contrast to GFL’s situation, JPMorgan favors U.S.-based Casella Waste Systems Inc., a mid-tier publicly traded waste management company. Casella has attracted activist investor interest, notably from Jana Partners LLC, which recently urged the company to pursue strategies that enhance profitability, improve returns on invested capital, and better align executive compensation with shareholder value. Following the announcement of the activist campaign, Casella shares experienced an 11 percent jump.

Casella, with a market capitalization around US$6.2 billion, carries relatively low debt and is seen by JPMorgan as having a strong potential for margin improvement. The analysts project the company’s share price could increase substantially, with a target at US$99 and the possibility of fetching up to US$120 per share in the event of a takeover. Meanwhile, GFL’s potential acquisition could pave the way for a leveraged buyout of Casella, further boosting its stock value.

JPMorgan’s recommendation reflects a classic hedge fund strategy known as a long-short position, with investors taking short positions on GFL and long positions on Casella to profit regardless of market fluctuations. The financial community remains attentive to GFL’s upcoming earnings report for clearer indications of the company’s direction and the private equity bids’ outcome.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.