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Waste Connections Inc WCN

Rating as of

Morningstar’s Analysis

Valuation
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Waste Connections Sees Stronger Growth Ahead As the North American Economy Recovers

Analyst Note

| Brian Bernard, CFA, CPA |

Wide-moat rated Waste Connections reported solid first-quarter results that featured both top line growth and EBITDA margin expansion. Revenue increased about 3% year over year to $1.4 billion; strong core price of 4.5% and 90 basis points of growth tied to recycling were partially offset by almost a 3.2% decrease in volume. That said, solid waste volume returned to growth in March with a 2.6% year-over-year gain, and management said landfill volumes have bounced back to pre-pandemic levels. Management expects $1.49 billion of revenue next quarter, driven by a 10% increase in volume plus price. We believe this target is achievable if not conservative based on current trends and our economic outlook.

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Company Profile

Business Description

Waste Connections is the third- largest integrated provider of traditional solid waste and recycling services in the North America, operating 91 active landfills (12 are E&P waste landfills), 132 transfer stations, and 68 recycling operations. The firm serves residential, commercial, industrial, and energy end markets. Waste Connections entered the Canadian market with its 2016 merger with Progressive Waste. In 2020, 13% of consolidated revenue was generated from the firm's Canadian segment.

Contact
610 Applewood Crescent, 2nd Floor
Vaughan, ON, L4K 0E3, Canada
T +1 905 532-7510
Sector Industrials
Industry Waste Management
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2021
Stock Type
Employees 18,933

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