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3 Reasons to Add Waste Management (WM) to Your Portfolio Now
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Headquartered in Houston, TX, Waste Management, Inc. (WM - Free Report) is a leading provider of comprehensive waste management services in North America. The company provides collection, transfer, recycling and resource recovery, as well as disposal services to residential, commercial, industrial and municipal customers. It is also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the U.S.
Let us have a look at the reasons that make the stock a must buy at the moment.
Solid Rank & VGM Score
Waste Management currently has a Zacks Rank #2 (Buy) and a Value Growth Momentum Score (VGM Score) of ‘B’. Our research shows that stocks with a VGM Score of ‘A’ or ‘B’ combined with a Zacks Rank #1 (Strong Buy) or #2, offer the best investment opportunities. Consequently, Waste Management appears to be a solid investment proposition at the moment.
Positive Estimate Revisions
Over the last three months, Waste Management’s current-year estimates increased from $3.17 to $3.18 per share while that for the next year increased from $3.41 to $3.44. With positive estimate revisions, investor sentiments clearly appear to be bullish on the stock.
Strong Price Performance
Waste Management’s shares have performed relatively better than the Zacks categorized Waste Removal Services industry with an average one-year return of 16.9% compared with 15.4% gain for the latter. Despite a challenging macroeconomic environment, Waste Management started 2017 on a positive note with strong first-quarter results, driven by healthy year-over-year increase in earnings and revenues. GAAP earnings for the reported quarter were $298 million or 67 cents per share compared with $258 million or 58 cents per share in the year-earlier quarter. Net sales during the quarter were $3,440 million, up from $3,176 million in the year-ago quarter.
Moving Forward
Waste Management’s successful cost-reduction initiatives helped it in accomplishing remarkable gross margin expansion and EBITDA (earnings before interest, tax, depreciation and amortization) growth over the quarters. The company is undertaking several steps to further boost its margins. With strong yield, volume, and cost performance in the first quarter, the company has reaffirmed its bullish guidance. It continues to expect 2017 adjusted earnings in the range of $3.14 to $3.18 per share. Free cash flow is expected between $1.5 billion and $1.6 billion. We believe that such a bullish stance, along with its robust operating platform and an efficient management team will help in the execution of its strategic priorities and drive net asset value.
Advanced Disposal Services topped earnings estimates twice in the trailing four quarters with a stellar positive surprise of 227.8%.
CBIZ surpassed estimates twice in the trailing four quarters with an average positive earnings surprise of 18.4%.
Republic Services has a long-term earnings growth expectation of 9.2%. It surpassed estimates thrice in the trailing four quarters with an average positive earnings surprise of 3.6%.
Zacks' 2017 IPO Watch List
Before looking into the stocks mentioned above, you may want to get a head start on potential tech IPOs that are popping up on Zacks' radar. Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential? This Special Report gives you the current scoop on 5 that may go public at any time.
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3 Reasons to Add Waste Management (WM) to Your Portfolio Now
Headquartered in Houston, TX, Waste Management, Inc. (WM - Free Report) is a leading provider of comprehensive waste management services in North America. The company provides collection, transfer, recycling and resource recovery, as well as disposal services to residential, commercial, industrial and municipal customers. It is also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the U.S.
Let us have a look at the reasons that make the stock a must buy at the moment.
Solid Rank & VGM Score
Waste Management currently has a Zacks Rank #2 (Buy) and a Value Growth Momentum Score (VGM Score) of ‘B’. Our research shows that stocks with a VGM Score of ‘A’ or ‘B’ combined with a Zacks Rank #1 (Strong Buy) or #2, offer the best investment opportunities. Consequently, Waste Management appears to be a solid investment proposition at the moment.
Positive Estimate Revisions
Over the last three months, Waste Management’s current-year estimates increased from $3.17 to $3.18 per share while that for the next year increased from $3.41 to $3.44. With positive estimate revisions, investor sentiments clearly appear to be bullish on the stock.
Strong Price Performance
Waste Management’s shares have performed relatively better than the Zacks categorized Waste Removal Services industry with an average one-year return of 16.9% compared with 15.4% gain for the latter. Despite a challenging macroeconomic environment, Waste Management started 2017 on a positive note with strong first-quarter results, driven by healthy year-over-year increase in earnings and revenues. GAAP earnings for the reported quarter were $298 million or 67 cents per share compared with $258 million or 58 cents per share in the year-earlier quarter. Net sales during the quarter were $3,440 million, up from $3,176 million in the year-ago quarter.
Moving Forward
Waste Management’s successful cost-reduction initiatives helped it in accomplishing remarkable gross margin expansion and EBITDA (earnings before interest, tax, depreciation and amortization) growth over the quarters. The company is undertaking several steps to further boost its margins. With strong yield, volume, and cost performance in the first quarter, the company has reaffirmed its bullish guidance. It continues to expect 2017 adjusted earnings in the range of $3.14 to $3.18 per share. Free cash flow is expected between $1.5 billion and $1.6 billion. We believe that such a bullish stance, along with its robust operating platform and an efficient management team will help in the execution of its strategic priorities and drive net asset value.
Other top stocks in the industry include Advanced Disposal Services, Inc. , CBIZ, Inc. (CBZ - Free Report) and Republic Services, Inc. (RSG - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Advanced Disposal Services topped earnings estimates twice in the trailing four quarters with a stellar positive surprise of 227.8%.
CBIZ surpassed estimates twice in the trailing four quarters with an average positive earnings surprise of 18.4%.
Republic Services has a long-term earnings growth expectation of 9.2%. It surpassed estimates thrice in the trailing four quarters with an average positive earnings surprise of 3.6%.
Zacks' 2017 IPO Watch List
Before looking into the stocks mentioned above, you may want to get a head start on potential tech IPOs that are popping up on Zacks' radar. Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential? This Special Report gives you the current scoop on 5 that may go public at any time.
One has driven from 0 to a $68 billion valuation in 8 years. Four others are a little less obvious but already show jaw-dropping growth. Download this IPO Watch List today for free >>