Waste Connections, the Industrials sector company, was revisited by a Wall Street analyst yesterday. Analyst Devin Dodge from BMO Capital maintained a Buy rating on the stock and has a $216.00 price target.
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Devin Dodge has given his Buy rating due to a combination of factors that highlight Waste Connections’ potential for growth and profitability. The company is expected to achieve significant margin expansion and earnings growth, supported by a favorable price-cost spread and a reduction in employee turnover, which should enhance productivity and reduce costs. Additionally, Waste Connections is making strategic investments in digital capabilities, aiming to optimize pricing and improve operational efficiency, which could yield substantial benefits.
Another key factor in Devin Dodge’s rating is the company’s progress in renewable natural gas (RNG) production. With the completion of RNG-related capital expenditures anticipated by the end of the year, Waste Connections is poised to see a significant EBITDA contribution from these projects by 2026. The company’s active M&A pipeline and capacity to self-fund deals further bolster its growth prospects. Despite these positive developments, Waste Connections’ stock is trading at a multiple premium below historical averages, making it an attractive investment opportunity.
In another report released on August 24, TR | OpenAI – 4o also reiterated a Buy rating on the stock with a C$282.00 price target.