Waste Management, the Industrials sector company, was revisited by a Wall Street analyst today. Analyst Michael Feniger from Bank of America Securities reiterated a Hold rating on the stock and has a $251.00 price target.
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Michael Feniger has given his Hold rating due to a combination of factors influencing Waste Management’s current financial standing and market position. The company reported a strong second quarter with better-than-expected earnings before interest, taxes, depreciation, and amortization (EBITDA), yet the full-year outlook remains unchanged at the midpoint. This suggests that while the company is performing well, particularly in the face of declining commodity prices and potential volume slowdowns, there are no significant upgrades anticipated in the near term.
Feniger also notes that Waste Management is executing effectively despite the perception of having many moving parts compared to its peers. The company’s performance in areas such as sustainability and cash flow from operations is commendable, yet the valuation remains somewhat discounted. This is partly due to the volatility in non-waste factors like old corrugated containers (OCC) and renewable identification numbers (RINs), as well as the integration of Stericycle. Consequently, while Waste Management is a quality operator, Feniger maintains a balanced view on the risks and prefers its peer, Republic Services Group (RSG), leading to a Hold rating.
In another report released yesterday, Robert W. Baird also maintained a Hold rating on the stock with a $248.00 price target.