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Waste Management (WM)
NYSE:WM
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Waste Management (WM) AI Stock Analysis

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WM

Waste Management

(NYSE:WM)

Rating:69Neutral
Price Target:
$249.00
▲(13.15% Upside)
Waste Management's overall stock score is driven by its strong financial performance and positive earnings call sentiment. However, technical indicators and valuation suggest caution, as the stock may be overvalued and facing short-term technical challenges. The company's strategic initiatives and sustainable growth focus provide a positive outlook, but investors should be mindful of potential risks.
Positive Factors
Financial Performance
Waste Management reported a better-than-expected Q2 performance, demonstrating strong execution across the board.
Mergers & Acquisitions
WM's significant capacity to self-fund deals provides upside to estimates.
Renewable Energy
WM's renewable energy segment has locked in 90% of its RIN volume for 2025 through forward contracts.
Negative Factors
Peer Comparison
Part of the valuation discount for Waste Management is due to the perception of 'too many moving pieces' compared to its peers.
Valuation Concerns
Optimism is largely captured in the current valuation.

Waste Management (WM) vs. SPDR S&P 500 ETF (SPY)

Waste Management Business Overview & Revenue Model

Company DescriptionWaste Management, Inc., through its subsidiaries, provides waste management environmental services to residential, commercial, industrial, and municipal customers in North America. It offers collection services, including picking up and transporting waste and recyclable materials from where it was generated to a transfer station, material recovery facility (MRF), or disposal site; and owns, develops, and operates landfill gas-to-energy facilities in the United States, as well as owns and operates transfer stations. As of December 31, 2021, the company owned or operated 255 solid waste landfills; 5 secure hazardous waste landfills; 96 MRFs; and 340 transfer stations. It also provides materials processing and commodities recycling services; recycling brokerage services, such as managing the marketing of recyclable materials for third parties; and other strategic business solutions. In addition, the company offers construction and remediation services; services related with the disposal of fly ash, and residue generated from the combustion of coal and other fuel stocks; in-plant services comprising full-service waste management solutions and consulting services; and specialized disposal services for oil and gas exploration and production operations. The company was formerly known as USA Waste Services, Inc. and changed its name to Waste Management, Inc. in 1998. Waste Management, Inc. was incorporated in 1987 and is headquartered in Houston, Texas.
How the Company Makes MoneyWaste Management generates revenue primarily through its collection and disposal services, which include fees charged for residential and commercial waste collection, landfill operations, and recycling services. The company operates a network of landfills, transfer stations, and recycling facilities, allowing it to charge tipping fees for waste that is deposited at its landfills. Additionally, WM earns revenue from its waste-to-energy operations, where it converts waste into renewable energy, and from the sale of recyclable materials. Key partnerships with local governments and municipalities, as well as contracts with large commercial clients, also contribute significantly to its earnings. The company's focus on increasing recycling rates and developing sustainable waste management solutions enhances its revenue potential in an increasingly eco-conscious market.

Waste Management Key Performance Indicators (KPIs)

Any
Any
Collection Revenue by Type
Collection Revenue by Type
Analyzes revenue from different waste collection services, highlighting the company's strengths in various waste management solutions and potential areas for growth or increased competition.
Chart InsightsWaste Management's commercial collection revenue is steadily increasing, indicating strong demand in the business sector. Industrial revenue shows a recovery trend post-pandemic, though with some fluctuations. Residential revenue growth is stable but slower, reflecting market saturation. The 'Other Collection' category experienced a significant spike, suggesting a strategic shift or new service offerings. This diversification could mitigate risks associated with dependency on traditional segments, positioning Waste Management for sustainable growth amid evolving market dynamics.
Data provided by:Main Street Data

Waste Management Earnings Call Summary

Earnings Call Date:Jul 28, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Positive
The earnings call reflected a generally positive sentiment with strong EBITDA growth, successful integration of acquisitions, and increased free cash flow guidance. However, challenges such as declining recycled commodity prices and the loss of a franchise contract impacted revenue expectations.
Q2-2025 Updates
Positive Updates
Strong Operating EBITDA Growth
The company reported a 19% growth in operating EBITDA for the second quarter, with significant contributions from the collection and disposal business.
Landfill Volume Growth
Landfill volumes were particularly strong, contributing to the overall solid waste volume growth in key markets.
Sustainability Platform Success
Recycling segment operating EBITDA grew by 17% despite a 15% decline in recycled commodity prices, showcasing the strength of sustainability investments.
Healthcare Solutions Synergy
The integration of WM Healthcare Solutions is on track to achieve the upper end of targeted synergies of $80 million to $100 million in 2025.
Margin Expansion
The collection and disposal operating EBITDA improved by 60 basis points to 37.9%, driven by strong landfill volumes and pricing discipline.
Free Cash Flow Guidance Increase
The company has increased its expectations for 2025 free cash flow to between $2.8 billion and $2.9 billion.
Renewable Energy Projects
Three new projects commenced operations during the quarter, including a renewable natural gas facility in Illinois.
Negative Updates
Recycled Commodity Price Decline
Recycled commodity prices declined by nearly 15% compared to last year, impacting revenue expectations.
Volume Impact from Franchise Contract Loss
The loss of a large franchise contract negatively affected residential and commercial volumes.
Revenue Guidance Reduction
Revenue for the year is expected to be about 1% below initial expectations due to factors such as recycled commodity prices and harsh winter weather.
Alternative Fuel Tax Credit Impact
The expiration of alternative fuel tax credits had a negative 30 basis point impact on margins for the quarter.
Company Guidance
During the WM Second Quarter 2025 Earnings Conference Call, the company reported a 19% year-over-year increase in operating EBITDA, driven primarily by its collection and disposal business, which contributed over half of this growth. The landfill volumes were particularly strong, with MSW volume growth highlighted, alongside special waste volumes due to wildfire cleanup efforts in California. The company emphasized its ongoing acquisition strategy, having completed the acquisition of a regional solid waste player in Washington, D.C., and expects total acquisition spending to exceed $500 million for the year. WM's sustainability platform continued to support its investment thesis, with the recycling segment's operating EBITDA growing by 17% despite a 15% decrease in recycled commodity prices. The company is on track to achieve the upper end of its targeted $80 million to $100 million synergies in 2025 for its WM Healthcare Solutions segment. Finally, WM confirmed its 2025 guidance with a midpoint operating EBITDA of $7.55 billion and revised its free cash flow expectations to between $2.8 billion and $2.9 billion.

Waste Management Financial Statement Overview

Summary
Waste Management demonstrates solid financial health with consistent revenue and profit growth, strong operational efficiency, and effective cash flow management. The company maintains a balanced equity structure with low debt levels, positioning it well for future growth.
Income Statement
85
Very Positive
Waste Management shows a strong financial performance with consistent revenue growth and robust profit margins. The Gross Profit Margin for TTM is 39.7%, and the Net Profit Margin is 11.4%. Revenue has been growing steadily, with a TTM Revenue Growth Rate of 8.5% compared to the previous year. EBIT and EBITDA margins are healthy at 17.5% and 24.7%, respectively, indicating efficient operational management.
Balance Sheet
78
Positive
The company's balance sheet is stable, with a manageable Debt-to-Equity Ratio of 0.10 in TTM, reflecting conservative financial leverage. Return on Equity is strong at 29.6%, showing effective use of shareholder funds. The Equity Ratio is 20.1%, indicating a balanced approach to financing with both debt and equity.
Cash Flow
80
Positive
Cash flow performance is strong with positive Free Cash Flow growth, up by 0.19% in TTM. The Operating Cash Flow to Net Income Ratio is 2.07, indicating a high conversion of income into cash. The Free Cash Flow to Net Income Ratio is 0.79, suggesting that a substantial portion of income is available as free cash flow.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue23.95B22.06B20.43B19.70B17.93B15.22B
Gross Profit6.94B6.41B5.75B5.37B4.82B4.21B
EBITDA6.92B6.46B5.72B5.45B4.82B4.09B
Net Income2.72B2.75B2.30B2.24B1.82B1.50B
Balance Sheet
Total Assets45.72B44.57B32.82B31.37B29.10B29.34B
Cash, Cash Equivalents and Short-Term Investments440.00M414.00M458.00M351.00M118.00M553.00M
Total Debt24.02B23.90B16.23B14.98B13.40B13.81B
Total Liabilities36.52B36.31B25.93B24.50B21.97B21.89B
Stockholders Equity9.20B8.25B6.90B6.85B7.12B7.45B
Cash Flow
Free Cash Flow2.16B2.16B1.82B1.95B2.43B1.77B
Operating Cash Flow5.62B5.39B4.72B4.54B4.34B3.40B
Investing Cash Flow-10.16B-10.60B-3.09B-3.06B-1.89B-4.85B
Financing Cash Flow4.84B5.16B-1.52B-1.22B-2.90B-1.56B

Waste Management Technical Analysis

Technical Analysis Sentiment
Negative
Last Price220.06
Price Trends
50DMA
227.90
Negative
100DMA
230.16
Negative
200DMA
224.44
Negative
Market Momentum
MACD
-1.71
Positive
RSI
36.43
Neutral
STOCH
18.75
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WM, the sentiment is Negative. The current price of 220.06 is below the 20-day moving average (MA) of 227.43, below the 50-day MA of 227.90, and below the 200-day MA of 224.44, indicating a bearish trend. The MACD of -1.71 indicates Positive momentum. The RSI at 36.43 is Neutral, neither overbought nor oversold. The STOCH value of 18.75 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WM.

Waste Management Risk Analysis

Waste Management disclosed 38 risk factors in its most recent earnings report. Waste Management reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Waste Management Peers Comparison

Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
$12.67B33.1814.93%5.49%-1.66%
73
Outperform
$71.73B33.9618.41%1.01%5.13%13.29%
70
Outperform
$1.07B-7.61%17.78%2.57%
69
Neutral
$88.65B32.6532.67%1.43%14.18%7.02%
64
Neutral
$10.73B15.747.60%2.01%2.75%-15.09%
57
Neutral
$6.01B523.730.85%20.35%-45.38%
56
Neutral
$946.81M-35.66%-0.83%-61.90%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
WM
Waste Management
220.06
14.53
7.07%
CWST
Casella Waste
94.69
-10.68
-10.14%
CLH
Clean Harbors
236.25
1.42
0.60%
NVRI
Enviri
11.76
1.96
20.00%
RSG
Republic Services
229.73
26.58
13.08%
MEG
Montrose Environmental Group
30.41
3.14
11.51%

Waste Management Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
Waste Management Approves $2.1M Retention Award for Executive
Neutral
Aug 27, 2025

On August 21, 2025, Waste Management, Inc.’s Board of Directors approved a $2.1 million retention award of restricted stock units (RSUs) to Tara J. Hemmer, the Senior Vice President and Chief Sustainability Officer. This award aims to retain key leadership and aligns with the company’s sustainability goals, potentially impacting its strategic positioning and stakeholder interests.

Executive/Board ChangesBusiness Operations and Strategy
Waste Management Announces CFO Resignation and Successor
Neutral
Aug 22, 2025

On August 21, 2025, WM announced the resignation of Devina Rankin, its Executive Vice President and Chief Financial Officer, effective November 1, 2025. Rankin, who has been with the company for nearly 23 years, will focus on education and not-for-profit service after her departure. David Reed, currently Vice President and Business Partner for WM’s West Tier operations, will succeed her as CFO. Reed’s extensive background in finance and leadership positions him well to support WM’s long-term growth strategy. His appointment includes an increase in base salary and a grant of restricted stock units, reflecting confidence in his ability to contribute to the company’s strategic objectives.

Business Operations and Strategy
Waste Management Hosts 2025 Investor Day at NYSE
Positive
Jun 24, 2025

On June 24, 2025, Waste Management, now known as WM, hosted its 2025 Investor Day at the New York Stock Exchange. The event, which included presentations and Q&A sessions with senior leadership, focused on the company’s long-term vision and growth strategies. CEO Jim Fish emphasized WM’s commitment to a people-first culture and its plans to leverage its asset network for sustainable growth, aiming to provide lasting value for shareholders.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 24, 2025