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Is a Beat in Store for Waste Management (WM) in Q2 Earnings?

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Waste Management, Inc. (WM - Free Report) is scheduled to report second-quarter 2019 results on Jul 25, before the bell.

So far this year, shares of Waste Management have gained 31.3% compared with 26.1% rise of the industry it belongs to and 17.2% rise of the Zacks S&P 500 composite.

 

Collection and Disposal Business to Boost the Top Line

Waste Management’s top line is likely to be driven by solid yield and volume growth in the collection and disposal business. However, the company’s recycling line of business is expected to stay weak. The Zacks Consensus Estimate for second-quarter 2019 revenues is pegged at $3.94 billion, indicating year-over-year growth of 5.4%.

In first-quarter 2019, revenues of $3.69 billion increased 5.3% year over year.

Earnings Expectations

Improved operating results in the solid waste business are likely to boost Waste Management’s bottom line. The Zacks Consensus Estimate for earnings per share in the to-be-reported quarter is pegged at $1.07, indicating year-over-year growth of 5.9%.

In first-quarter 2019, adjusted earnings of 94 cents came ahead of the year-ago quarter by 3 cents.

Our Model Suggests a Beat

Please note that according to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Zacks Rank #4 (Sell) or 5 (Strong Sell) stocks are best avoided, especially if the companies are witnessing negative estimate revisions. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Waste Management has a Zacks Rank #3 and an Earnings ESP of +0.70%, a combination that increases the odds of an earnings beat.

Waste Management, Inc. Price and EPS Surprise

Waste Management, Inc. Price and EPS Surprise

Waste Management, Inc. price-eps-surprise | Waste Management, Inc. Quote

Other Stocks to Consider

Here are a few stocks from the broader Zacks Business Services sector that investors may also consider as our model shows that these have the right combination of elements to beat on second-quarter 2019 earnings:

S&P Global (SPGI - Free Report) has an Earnings ESP of +0.94% and a Zacks Rank #2.  The company is slated to report results on Aug 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

IQVIA Holdings (IQV - Free Report) has an Earnings ESP of +1.12% and a Zacks Rank #3. The company is slated to release results on Jul 24.

Fiserv has an Earnings ESP of +0.79% and a Zacks Rank #3. The company is slated to report results on Jul 25.

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