Waste Management’s (NYSE:WM) Q3 Sales Top Estimates

WM Cover Image
Waste Management’s (NYSE:WM) Q3 Sales Top Estimates

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Waste management services provider Waste Management (NYSE:WM) reported Q3 CY2024 results topping the market’s revenue expectations , with sales up 7.9% year on year to $5.61 billion. Its non-GAAP profit of $1.96 per share was also 4% above analysts’ consensus estimates.

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Waste Management (WM) Q3 CY2024 Highlights:

  • Revenue: $5.61 billion vs analyst estimates of $5.51 billion (1.7% beat)

  • Adjusted EPS: $1.96 vs analyst estimates of $1.88 (4% beat)

  • EBITDA: $1.71 billion vs analyst estimates of $1.68 billion (1.6% beat)

  • EBITDA guidance for the full year is $6.5 billion at the midpoint, in line with analyst expectations

  • Gross Margin (GAAP): 39.4%, in line with the same quarter last year

  • Operating Margin: 20%, in line with the same quarter last year

  • EBITDA Margin: 30.5%, in line with the same quarter last year

  • Free Cash Flow Margin: 13.5%, up from 11.8% in the same quarter last year

  • Market Capitalization: $82.99 billion

“The Company’s third quarter results again demonstrated the dedication of our people, the consistency of our business model, and the strength of our operations,” said Jim Fish, WM’s President and Chief Executive Officer.

Company Overview

Headquartered in Houston, Waste Management (NYSE:WM) is a provider of comprehensive waste management services in North America.

Waste Management

Waste management companies can possess licenses permitting them to handle hazardous materials. Furthermore, many services are performed through contracts and statutorily mandated, non-discretionary, or recurring, leading to more predictable revenue streams. However, regulation can be a headwind, rendering existing services obsolete or forcing companies to invest precious capital to comply with new, more environmentally-friendly rules. Lastly, waste management companies are at the whim of economic cycles. Interest rates, for example, can greatly impact industrial production or commercial projects that create waste and byproducts.

Sales Growth

Examining a company’s long-term performance can provide clues about its business quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last five years, Waste Management grew its sales at a mediocre 6.7% compounded annual growth rate. This shows it couldn’t expand in any major way, a tough starting point for our analysis.

Waste Management Total Revenue
Waste Management Total Revenue

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Waste Management’s recent history shows its demand slowed as its annualized revenue growth of 4.9% over the last two years is below its five-year trend.