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Waste Management (WM) Gains 9.6% in 3 Months: Here's How

Shares of Waste Management, Inc. WM have rallied 9.6% in the past three months, outperforming the 9.1% gain of the industry it belongs to.

Reasons for the Upside

Being a leading provider of comprehensive waste management environmental services, WM is expected to continue benefiting from ongoing trends like increasing environmental concerns, rapid industrialization, increase in population and active government measures to reduce illegal dumping.The company’s top line increased 12.3% year over year in the second quarter of 2022.

Waste Management, Inc. Revenue (TTM)

Waste Management, Inc. Revenue (TTM)
Waste Management, Inc. Revenue (TTM)

Waste Management, Inc. revenue-ttm | Waste Management, Inc. Quote

Waste Management has a dominant market capitalization and a steady dividend as well as a share repurchase policy. In 2021, 2020 and 2019, the company had repurchased shares worth $1.35 billion, $402 million and $248 million, respectively.

WM paid $970 million, $927 million and $876 million in dividends during 2021, 2020 and 2019, respectively. The company plans to return significant cash to shareholders through healthy dividends and share repurchases in the future as well.

Waste Management continues to execute core operating initiatives targeting focused differentiation and continuous improvement and instilling price and cost discipline to achieve better margins. While differentiation through capitalization of extensive assets ensures long-term profitable growth and competitive advantages, cost control and process improvement help enhance service quality.

Favorable Estimates Revision

Driven by the above tailwinds, the Zacks Consensus Estimate for 2022 earnings has moved up 2.7% to $5.7 per share in the past 60 days.

Zacks Rank and Stocks to Consider

Waste Management currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Zacks Business Services sector are Avis Budget Group, Inc. CAR, Automatic Data Processing, Inc. ADP and CRA International, Inc. CRAI.

Avis Budget sports a Zacks Rank #1 (Strong Buy) at present. CAR has an earnings growth rate of 108.4% for 2022. You can see the complete list of today’s Zacks #1 Rank stocks here.

Avis Budget delivered a trailing four-quarter earnings surprise of 69.5%, on average.

Automatic Data Processing carries a Zacks Rank #2 (Buy) at present. ADP has a long-term earnings growth expectation of 12%.

ADP delivered a trailing four-quarter earnings surprise of 5%, on average.

CRA International carries a Zacks Rank of 2, currently. CRAI has a long-term earnings growth expectation of 14.3%.

CRAI delivered a trailing four-quarter earnings surprise of 26%, on average.

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Waste Management, Inc. (WM) : Free Stock Analysis Report
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