Bank of America Securities analyst Michael Feniger has maintained their neutral stance on WM stock, giving a Hold rating today.
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Michael Feniger’s rating is based on a combination of factors that reflect both opportunities and challenges for Waste Management. The company’s shares have slightly underperformed compared to the broader market, partly due to concerns about free cash flow conversion and the impact of recycled commodities prices. Despite these concerns, the long-term strategy presented at the Investor Day was viewed positively, highlighting Waste Management’s focus on leveraging its unique logistics network and platform for growth.
Feniger also noted that while Waste Management’s free cash flow growth is currently lagging behind EBITDA growth due to factors like tax credits and depreciation, there is potential for improvement as capital expenditure intensity moderates over time. Additionally, the company’s unmatched asset base and potential advantages in transportation assets provide a solid foundation for future growth. However, near-term commodity price volatility remains a concern, justifying the Hold rating as the company navigates these dynamics.
In another report released today, Morgan Stanley also maintained a Hold rating on the stock with a $235.00 price target.