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Waste Connections Inc WCN

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Stock XNYS Rating as of
$163.48 −1.70 (1.03%)
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As of Delayed Price Closed
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Company Report

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Waste Connections Earnings: Well Positioned After Strong Execution During the First Quarter

Brian Bernard,

Wide-moat-rated Waste Connections reported robust first-quarter results as revenue and adjusted EBITDA increased 9% and 15%, respectively. Both revenue and adjusted EBITDA came in above prior guidance; however, adjusted EBITDA missed the FactSet consensus estimate by 2%. Nonetheless, our underlying thesis for the company is unchanged. As such, we don't expect to materially change our fair value estimate, save for a time value of money adjustment.

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Price vs Fair Value

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WCN is trading at a 22% premium.
Price
$166.27
Fair Value
$526.00
Uncertainty
Low
1-Star Price
$726.00
5-Star Price
$143.20
Economic Moat
Chtm
Capital Allocation
Ympslyzs

Bulls Say, Bears Say

Bulls

Waste Connections enjoys strong pricing power—a feature of its wide economic moat. This pricing power has allowed the firm to defend profit margins in the current inflationary environment.

Bears

Many U.S. municipalities are gradually pushing for greater solid waste reduction and recycling, which could temper the level of higher-margin waste entering Waste Connections’ landfills over the long run.

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Trading Information

Previous Close Price
$165.18
Day Range
$162.83–165.40
52-Week Range
$126.12–173.03
Bid/Ask
$163.01 / $164.16
Market Cap
$42.17 Bil
Volume/Avg
1.1 Mil / 913,632

Key Statistics

Price/Earnings (Normalized)
38.06
Price/Sales
5.21
Dividend Yield (Trailing)
0.66%
Dividend Yield (Forward)
0.70%
Total Yield
0.66%

Company Profile

Waste Connections is the third-largest integrated provider of traditional solid waste and recycling services in the North America, operating 103 active landfills (9 are exploration and production waste landfills and 16 are nonmunicipal waste landfills), 157 transfer stations, and 81 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 2023, 12% of consolidated revenue was generated from the firm's Canadian segment.
Sector
Industrials
Industry
Waste Management
Stock Style Box
Large Growth
Total Number of Employees
22,539
Website
https://www.wasteconnections.com

Competitors

Valuation

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Metric
WCN
SRCL
RSG
Price/Earnings (Normalized)
 38.0623.7534.27
Price/Book Value
 5.471.705.73
Price/Sales
 5.211.624.06
Price/Cash Flow
 19.5214.9716.92
Price/Earnings
WCN
SRCL
RSG

Financial Strength

Metric
WCN
SRCL
RSG
Quick Ratio
 0.620.990.50
Current Ratio
 0.751.110.56
Interest Coverage
 4.551.065.30
Quick Ratio
WCN
SRCL
RSG

Profitability

Metric
WCN
SRCL
RSG
Return on Assets (Normalized)
 6.05%1.06%5.94%
Return on Equity (Normalized)
 14.32%2.26%17.51%
Return on Invested Capital (Normalized)
 8.75%2.61%9.64%
Return on Assets
WCN
SRCL
RSG
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Waste Management Industry Comparables

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WM
Waste Management IncHzgklqtxPbt$84.3 Bil
RSG
Republic Services IncCsjvbzvwrFsdy$60.4 Bil
VEOEF
Veolia Environnement SA—Djxp$22.3 Bil
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Veolia Environnement SA ADRPwtnpnrgnTbcs$22.3 Bil
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GFL Environmental Inc—Hdqxbp$12.1 Bil
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Clean Harbors IncDkwdrgqfvDcqvnc$10.6 Bil
FMOCY
Fomento de Construcciones y Contratas SA ADR—Lbq$5.9 Bil
CWST
Casella Waste Systems Inc Class A—Zbfvhxs$5.5 Bil
SRCL
Stericycle IncYfgwqpqTdzxsfl$4.7 Bil

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