Wells Fargo added WM (WM) to the firm’s Q2 Tactical Ideas List. The firm sees multiple drivers of margin upside in coming quarters. First, WM’s per unit costs declined by 1.0% year-over-year in Q4 2025 amid strong cost control; normal seasonality off the base implies 100-plus bps of upside to the margin guidance. Second, recycled commodity prices are now set to be a tailwind, up 10%-plus year-to-date. Third, the industry passes through higher diesel costs with margin. Wells has an Overweight rating on the shares with a price target of $273.
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