We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is Waste Connections (WCN) Up 5.1% Since Last Earnings Report?
Read MoreHide Full Article
It has been about a month since the last earnings report for Waste Connections (WCN - Free Report) . Shares have added about 5.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Waste Connections due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Waste Connections Beats on Q2 Earnings
Waste Connections, Inc. reported solid second-quarter 2024 results, wherein earnings and revenues surpassed the Zacks Consensus Estimates.
Waste Connections’ adjusted earnings (excluding 17 cents from non-recurring items) of $1.2 per share beat the Zacks Consensus Estimate by 5.1% and increased 21.6% on a year-over-year basis. Revenues of $2.2 billion surpassed the consensus estimate by 1.4% and rose 11.2% from the year-ago quarter.
Segmental Revenues
The Solid Waste Collection segment’s revenues increased 6.6% year over year to $1.6 billion and met our estimate. The Solid Waste Disposal and Transfer segment’s revenues grew 9.7% from the year-ago quarter to $756.1 million and surpassed our estimate of $434.2 million.
The Solid Waste Recycling segment’s revenues increased 65.1% on a year-over-year basis to $63.3 million. The figure outpaced our estimate of $43.5 million. The Intermodal and Other segment’s revenues rose 24.4% from the year-ago quarter to $49.1 million, which beat our estimate of $34.9 million.
Further, the E&P Waste Treatment, Recovery, and Disposal segment’s revenues soared more than 100% from the year-ago quarter to $123.6 million, surpassing our estimate of $60.9 million.
Operating Results
Adjusted EBITDA in the reported quarter was $731.8 million, up 16.4% from the year-ago quarter. The adjusted EBITDA margin was 32.6%, which increased 150 basis points from the year-ago quarter.
Operating income totaled $424.7 million, higher than the year-ago figure of $344.1 million.
Balance Sheet and Cash Flow
Waste Connections exited the second quarter of 2024 with cash and cash equivalents of $78.7 million compared with $78.4 million at the end of the preceding quarter. The long-term debt was $6.7 billion, flat with the previous quarter.
In the reported quarter, WCN generated $574.4 million in cash from operating activities. The adjusted free cash flow was $402.6 million. Capital expenditure totaled $218.4 million. The company paid out $65.3 million worth of dividends in the quarter.
Updated 2024 Outlook
For 2024, Waste Connections anticipates revenues of $8.85 billion. WCN’s adjusted EBITDA and margin are expected to be $2.90 billion and 32.8%, respectively.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Waste Connections has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Waste Connections has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Waste Connections (WCN) Up 5.1% Since Last Earnings Report?
It has been about a month since the last earnings report for Waste Connections (WCN - Free Report) . Shares have added about 5.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Waste Connections due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Waste Connections Beats on Q2 Earnings
Waste Connections, Inc. reported solid second-quarter 2024 results, wherein earnings and revenues surpassed the Zacks Consensus Estimates.
Waste Connections’ adjusted earnings (excluding 17 cents from non-recurring items) of $1.2 per share beat the Zacks Consensus Estimate by 5.1% and increased 21.6% on a year-over-year basis. Revenues of $2.2 billion surpassed the consensus estimate by 1.4% and rose 11.2% from the year-ago quarter.
Segmental Revenues
The Solid Waste Collection segment’s revenues increased 6.6% year over year to $1.6 billion and met our estimate. The Solid Waste Disposal and Transfer segment’s revenues grew 9.7% from the year-ago quarter to $756.1 million and surpassed our estimate of $434.2 million.
The Solid Waste Recycling segment’s revenues increased 65.1% on a year-over-year basis to $63.3 million. The figure outpaced our estimate of $43.5 million. The Intermodal and Other segment’s revenues rose 24.4% from the year-ago quarter to $49.1 million, which beat our estimate of $34.9 million.
Further, the E&P Waste Treatment, Recovery, and Disposal segment’s revenues soared more than 100% from the year-ago quarter to $123.6 million, surpassing our estimate of $60.9 million.
Operating Results
Adjusted EBITDA in the reported quarter was $731.8 million, up 16.4% from the year-ago quarter. The adjusted EBITDA margin was 32.6%, which increased 150 basis points from the year-ago quarter.
Operating income totaled $424.7 million, higher than the year-ago figure of $344.1 million.
Balance Sheet and Cash Flow
Waste Connections exited the second quarter of 2024 with cash and cash equivalents of $78.7 million compared with $78.4 million at the end of the preceding quarter. The long-term debt was $6.7 billion, flat with the previous quarter.
In the reported quarter, WCN generated $574.4 million in cash from operating activities. The adjusted free cash flow was $402.6 million. Capital expenditure totaled $218.4 million. The company paid out $65.3 million worth of dividends in the quarter.
Updated 2024 Outlook
For 2024, Waste Connections anticipates revenues of $8.85 billion. WCN’s adjusted EBITDA and margin are expected to be $2.90 billion and 32.8%, respectively.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Waste Connections has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Waste Connections has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.