WM: The Resilient Leader in Waste Management
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy WM?
Source: Fool
- Industry Leadership: WM boasts North America's largest waste disposal network and collection fleet, generating $22.1 billion in annual revenue, solidifying its leadership in the $125 billion waste and recycling sector and demonstrating significant market influence.
- Strong Financial Performance: Despite a revenue growth rate of only 3% during the pandemic, WM achieved compound annual growth rates of 6% in revenue, 9% in earnings, and 13% in free cash flow from 2022 to 2024, showcasing its resilience throughout economic cycles.
- Robust Cash Flow: Last year, WM produced $6 billion in net cash flow from operating activities (up 12.1% year-over-year) and is allocating this strong cash flow towards acquisitions and sustainability projects, with expectations of nearly 8% compound annual growth in free cash flow through 2027.
- Enhanced Shareholder Returns: WM raised its dividend by 14.5% last year, extending its growth streak to 23 years, and announced a new $3 billion share repurchase authorization, further enhancing its appeal as a leading dividend stock.
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Analyst Views on WM
Wall Street analysts forecast WM stock price to rise
20 Analyst Rating
15 Buy
5 Hold
0 Sell
Strong Buy
Current: 224.080
Low
223.00
Averages
247.61
High
266.00
Current: 224.080
Low
223.00
Averages
247.61
High
266.00
About WM
Waste Management, Inc. is a provider of environmental solutions. The Company provides collection, recycling, and disposal services to millions of residential, commercial, industrial, and municipal customers throughout the United States and Canada. Its segments include East Tier, West Tier, Recycling Processing and Sales, WM Renewable Energy, and WM Healthcare Solutions. East Tier primarily consists of geographic areas located in the Eastern U.S., the Great Lakes region and all of Canada. The West Tier primarily includes geographic areas located in the Western U.S., including the upper Midwest region and British Columbia, Canada. Recycling Processing and Sales includes the processing and sales of materials collected from residential, commercial, and industrial customers. WM Renewable Energy develops, operates, and promotes projects for the beneficial use of landfill gas. WM Healthcare Solutions includes Regulated Waste and Compliance Services and Secure Information Destruction services.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
WM: The Resilient Leader in Waste Management
- Industry Leadership: WM boasts North America's largest waste disposal network and collection fleet, generating $22.1 billion in annual revenue, solidifying its leadership in the $125 billion waste and recycling sector and demonstrating significant market influence.
- Strong Financial Performance: Despite a revenue growth rate of only 3% during the pandemic, WM achieved compound annual growth rates of 6% in revenue, 9% in earnings, and 13% in free cash flow from 2022 to 2024, showcasing its resilience throughout economic cycles.
- Robust Cash Flow: Last year, WM produced $6 billion in net cash flow from operating activities (up 12.1% year-over-year) and is allocating this strong cash flow towards acquisitions and sustainability projects, with expectations of nearly 8% compound annual growth in free cash flow through 2027.
- Enhanced Shareholder Returns: WM raised its dividend by 14.5% last year, extending its growth streak to 23 years, and announced a new $3 billion share repurchase authorization, further enhancing its appeal as a leading dividend stock.
See More
WM: The Leader in Waste Collection Industry
- Industry Leadership: WM dominates the North American waste and recycling sector with a network of 506 waste transfer facilities, 262 landfills, and 105 recycling facilities, achieving $22.1 billion in annual revenue and ensuring a competitive edge in the $125 billion market.
- Strong Financial Performance: Despite a revenue growth rate of only 3% during the pandemic, WM achieved compound annual growth rates of 6% in revenue, 9% in earnings, and 13% in free cash flow from 2022 to 2024, demonstrating business resilience and profitability.
- Enhanced Shareholder Returns: WM raised its dividend by 14.5% last year, extending its growth streak to 23 years, while also announcing a $3 billion share repurchase authorization, further solidifying its status as a leading dividend stock.
- Sustainable Investment Strategy: WM plans to invest $3 billion in sustainability projects from 2022 to 2023, with expectations of nearly 8% compound annual growth in free cash flow through 2027, ensuring future business expansion and increased shareholder value.
See More
Republic Services: An Investment Opportunity in Waste Management
- Stable Long-Term Returns: Republic Services has outperformed its competitor Waste Management and the industrial sector over the past decade, demonstrating its ability to provide reliable investment returns even amid economic fluctuations, attracting investors seeking stability.
- Long-Term Contract Security: The company signs long-term contracts with the communities it serves, ensuring predictable revenue, which enhances investor confidence, especially during uncertain economic times.
- Expansion Opportunities from Population Growth: Operating in nearly every U.S. state, particularly in fast-growing states like Florida and Texas, Republic Services is well-positioned to capitalize on demographic trends and expand its market share.
- Sustainable Dividend Growth: With a nearly 50% increase in dividends over the past five years and a manageable payout ratio of 35.84%, the company is expected to generate $15 billion in free cash flow, enhancing its appeal as a long-term investment.
See More
Republic Services: A Steady Compounder in Waste Management
- Dividend Growth Potential: Republic Services has increased its dividend by nearly 50% over the past five years, making it an attractive option for long-term investors, while its payout ratio of 35.84% indicates sustainability, boosting investor confidence.
- Market Share Expansion: Operating in nearly every U.S. state and Washington D.C., the company is well-positioned to capture market share from smaller rivals, particularly in fast-growing states like Florida and Texas, showcasing strong growth potential through scaling in recycling and regulatory mandates.
- Stable Contract Base: Republic Services typically signs long-term contracts with the communities it serves, providing clarity in revenue expectations for investors, especially during economic fluctuations where demand for waste management services remains consistent, enhancing the company's resilience.
- Superior Cash Flow Performance: Despite ending last year with $13.6 billion in debt, the company is projected to generate $15 billion in free cash flow from this year through 2030, giving it stronger cash flow metrics compared to competitors, further supporting its dividend payment capacity.
See More
Buffett's Successor Looks to the Future
- Buffett's Succession: Berkshire Hathaway has appointed Greg Abel as the new CEO, who is expected to continue Buffett's share repurchase strategy, enhancing the company's long-term value and ensuring robust growth for decades to come.
- Otis Growth: Otis Worldwide, specializing in elevators since 1853, has a market value nearing $31 billion, with a recent dividend yield of 2.2% and a doubling of its dividend over the past five years, indicating a stable income stream and long-term investment appeal.
- WM's Steady Performance: As America's largest solid waste services company, WM has averaged nearly 14% annual growth over the past 15 years, with a dividend yield of 1.45% and an average annual increase of 10% over the last five years, showcasing its sustained demand and profitability in waste collection and recycling services.
- Investment Outlook: Although Berkshire Hathaway did not make the Motley Fool's list of the top 10 stocks, its long-term stability and strong dividend income still make it a noteworthy investment choice, especially in a rapidly changing market environment.
See More
Three Quality Companies for Long-Term Investment
- Buffett's Investment Choice: Berkshire Hathaway, under new CEO Greg Abel, continues its share buyback strategy, expected to remain in good shape for the future due to its subsidiaries in stable industries like transportation and energy, generating billions in annual dividend income.
- Otis's Stable Income: Otis Worldwide, focusing on elevators, has a market value of nearly $31 billion with a recent dividend yield of 2.2%, doubling its payout over the past five years; despite slow growth, its maintenance revenue increased by 7% year-over-year, providing a reliable income stream for retirement.
- Leader in Waste Management: WM, as America's largest solid waste services company, has averaged nearly 14% annual growth over the past 15 years, with a dividend yield of 1.45% and a 10% average annual increase in payouts over the last five years, expected to reward shareholders long-term despite a slightly elevated current P/E ratio.
- Market Attractiveness Analysis: Berkshire's P/E ratio stands at 21.6, Otis at 17.7, and WM at 28.2; while WM appears slightly overvalued, the stability and consistent returns of these companies in their respective sectors make them compelling long-term investment options.
See More
WM: The Resilient Leader in Waste Management
- Industry Leadership: WM boasts North America's largest waste disposal network and collection fleet, generating $22.1 billion in annual revenue, solidifying its leadership in the $125 billion waste and recycling sector and demonstrating significant market influence.
- Strong Financial Performance: Despite a revenue growth rate of only 3% during the pandemic, WM achieved compound annual growth rates of 6% in revenue, 9% in earnings, and 13% in free cash flow from 2022 to 2024, showcasing its resilience throughout economic cycles.
- Robust Cash Flow: Last year, WM produced $6 billion in net cash flow from operating activities (up 12.1% year-over-year) and is allocating this strong cash flow towards acquisitions and sustainability projects, with expectations of nearly 8% compound annual growth in free cash flow through 2027.
- Enhanced Shareholder Returns: WM raised its dividend by 14.5% last year, extending its growth streak to 23 years, and announced a new $3 billion share repurchase authorization, further enhancing its appeal as a leading dividend stock.
See More
WM: The Leader in Waste Collection Industry
- Industry Leadership: WM dominates the North American waste and recycling sector with a network of 506 waste transfer facilities, 262 landfills, and 105 recycling facilities, achieving $22.1 billion in annual revenue and ensuring a competitive edge in the $125 billion market.
- Strong Financial Performance: Despite a revenue growth rate of only 3% during the pandemic, WM achieved compound annual growth rates of 6% in revenue, 9% in earnings, and 13% in free cash flow from 2022 to 2024, demonstrating business resilience and profitability.
- Enhanced Shareholder Returns: WM raised its dividend by 14.5% last year, extending its growth streak to 23 years, while also announcing a $3 billion share repurchase authorization, further solidifying its status as a leading dividend stock.
- Sustainable Investment Strategy: WM plans to invest $3 billion in sustainability projects from 2022 to 2023, with expectations of nearly 8% compound annual growth in free cash flow through 2027, ensuring future business expansion and increased shareholder value.
See More
Republic Services: An Investment Opportunity in Waste Management
- Stable Long-Term Returns: Republic Services has outperformed its competitor Waste Management and the industrial sector over the past decade, demonstrating its ability to provide reliable investment returns even amid economic fluctuations, attracting investors seeking stability.
- Long-Term Contract Security: The company signs long-term contracts with the communities it serves, ensuring predictable revenue, which enhances investor confidence, especially during uncertain economic times.
- Expansion Opportunities from Population Growth: Operating in nearly every U.S. state, particularly in fast-growing states like Florida and Texas, Republic Services is well-positioned to capitalize on demographic trends and expand its market share.
- Sustainable Dividend Growth: With a nearly 50% increase in dividends over the past five years and a manageable payout ratio of 35.84%, the company is expected to generate $15 billion in free cash flow, enhancing its appeal as a long-term investment.
See More
Republic Services: A Steady Compounder in Waste Management
- Dividend Growth Potential: Republic Services has increased its dividend by nearly 50% over the past five years, making it an attractive option for long-term investors, while its payout ratio of 35.84% indicates sustainability, boosting investor confidence.
- Market Share Expansion: Operating in nearly every U.S. state and Washington D.C., the company is well-positioned to capture market share from smaller rivals, particularly in fast-growing states like Florida and Texas, showcasing strong growth potential through scaling in recycling and regulatory mandates.
- Stable Contract Base: Republic Services typically signs long-term contracts with the communities it serves, providing clarity in revenue expectations for investors, especially during economic fluctuations where demand for waste management services remains consistent, enhancing the company's resilience.
- Superior Cash Flow Performance: Despite ending last year with $13.6 billion in debt, the company is projected to generate $15 billion in free cash flow from this year through 2030, giving it stronger cash flow metrics compared to competitors, further supporting its dividend payment capacity.
See More
Buffett's Successor Looks to the Future
- Buffett's Succession: Berkshire Hathaway has appointed Greg Abel as the new CEO, who is expected to continue Buffett's share repurchase strategy, enhancing the company's long-term value and ensuring robust growth for decades to come.
- Otis Growth: Otis Worldwide, specializing in elevators since 1853, has a market value nearing $31 billion, with a recent dividend yield of 2.2% and a doubling of its dividend over the past five years, indicating a stable income stream and long-term investment appeal.
- WM's Steady Performance: As America's largest solid waste services company, WM has averaged nearly 14% annual growth over the past 15 years, with a dividend yield of 1.45% and an average annual increase of 10% over the last five years, showcasing its sustained demand and profitability in waste collection and recycling services.
- Investment Outlook: Although Berkshire Hathaway did not make the Motley Fool's list of the top 10 stocks, its long-term stability and strong dividend income still make it a noteworthy investment choice, especially in a rapidly changing market environment.
See More
Three Quality Companies for Long-Term Investment
- Buffett's Investment Choice: Berkshire Hathaway, under new CEO Greg Abel, continues its share buyback strategy, expected to remain in good shape for the future due to its subsidiaries in stable industries like transportation and energy, generating billions in annual dividend income.
- Otis's Stable Income: Otis Worldwide, focusing on elevators, has a market value of nearly $31 billion with a recent dividend yield of 2.2%, doubling its payout over the past five years; despite slow growth, its maintenance revenue increased by 7% year-over-year, providing a reliable income stream for retirement.
- Leader in Waste Management: WM, as America's largest solid waste services company, has averaged nearly 14% annual growth over the past 15 years, with a dividend yield of 1.45% and a 10% average annual increase in payouts over the last five years, expected to reward shareholders long-term despite a slightly elevated current P/E ratio.
- Market Attractiveness Analysis: Berkshire's P/E ratio stands at 21.6, Otis at 17.7, and WM at 28.2; while WM appears slightly overvalued, the stability and consistent returns of these companies in their respective sectors make them compelling long-term investment options.
See More
