Waste Management Stock Analysis, Valuation (NYSE:WM)

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$85.15 $1.13 (1.34%) WM stock closing price Feb 16, 2018 (Closing)
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Waste Management
Updated on : Feb 16, 2018
previous close
WM 85.2 (0%)
S&P 500 2732.2 (0%)
Closing Price On: Feb 16, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Waste Removal Services
Sector :
Business Services
5 Quarter Revenue
Revenue Growth
2017-Q3
$billion
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
1%
Operating Profit
Operating Margin:
17.8%
Sector Average:
8.4%
5 Quarter Net Profit
Net Margins
2017-Q3
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
9.35B
Debt/Equity Ratio:
 1.76
Compared to the industry
Cash Flow
Operating cash flow:
$856M
Net Income:
$386M
Dividend Yield
WM dividend yield:
2%
PROS      CONS
Operating Margins
Net Margins
Cash Flow
ROIC
ROE
FCF Margin
Long Term Growth
High Debt Burden
PE Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
WM PS :
2.6
Industry PS :
1.7
Sector:   Business Services.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
9.8%
Return on Equity:
25.5%
Free Cash Flow Margin:
13.6%
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Waste Management Stock Analysis

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View the Waste Management stock analysis video on Amigobulls. Our analyst opinion covering the buy and sell arguments for WM stock is shown in the video.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Waste Management, Inc. Stock Rating 3.4/5

Amigobulls WM stock analysis uses latest quarter 2017 Q3 financial data like Waste Management revenue growth, profit margins and cash flows. We also use relative valuation metrics like PE ratio and price to sales ratio for Waste Management valuation analysis. Waste Management stock rating encapsulates our opinion about the company based on the fundamentals.

Should you buy WM stock?

  • The TTM operating margin was good at 18.2% for Waste Management.
  • Net margins stood at a healthy 13.5% (average) for Waste Management in the Trailing Twelve Months.
  • The Waste Management stock currently trades at a price to earnings ratio of 26.4. We rate this as a positive, compared to the industry average of 22.3.
  • WM stock is trading at a favorable price to sales multiple of 2.6 as against the Waste Removal Services industry average multiple of 1.7.
  • Waste Management has an attractive ROIC (Return on Invested Capital) of 13.7%
  • The LTM ROE of 35.2% for Waste Management is attractive.

Should you sell WM stock?

  • Revenue growth of 1.2% has been weak over the last 5 years.
  • With a debt/equity ratio of  1.57, Waste Management is highly leveraged in comparison to Business Services peers.

Comments on this video and Waste Management stock

Amigobulls Waste Management stock analysis helps in evaluating the financial statements of a company to arrive at a conclusion about the fair value of WM stock. The fundamentals of a company are vital to identify long-term investment opportunities.

Waste Management revenue growth is an indicator of the demand for a company's products while profit margin is indicative of company's pricing power and pricing strategy. Along with fundamentals, investors can utilize technical analysis to get a better idea about the price trend of Waste Management stock.