Waste Management (NYSE: WM) is one of 304 public companies in the “BUSINESS SERVICES” industry, but how does it contrast to its peers? We will compare Waste Management to related businesses based on the strength of its earnings, dividends, institutional ownership, valuation, risk, profitability and analyst recommendations.
Risk and Volatility
Waste Management has a beta of 0.7, meaning that its share price is 30% less volatile than the S&P 500. Comparatively, Waste Management’s peers have a beta of 1.01, meaning that their average share price is 1% more volatile than the S&P 500.
Institutional and Insider Ownership
76.7% of Waste Management shares are owned by institutional investors. Comparatively, 57.5% of shares of all “BUSINESS SERVICES” companies are owned by institutional investors. 0.2% of Waste Management shares are owned by insiders. Comparatively, 16.0% of shares of all “BUSINESS SERVICES” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Waste Management pays an annual dividend of $1.86 per share and has a dividend yield of 2.2%. Waste Management pays out 42.2% of its earnings in the form of a dividend. As a group, “BUSINESS SERVICES” companies pay a dividend yield of 1.6% and pay out 47.0% of their earnings in the form of a dividend. Waste Management has increased its dividend for 14 consecutive years. Waste Management is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.
This is a summary of current ratings for Waste Management and its peers, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Waste Management Competitors||1125||5268||7873||223||2.50|
Waste Management currently has a consensus target price of $89.86, indicating a potential upside of 6.67%. As a group, “BUSINESS SERVICES” companies have a potential upside of 9.01%. Given Waste Management’s peers higher probable upside, analysts clearly believe Waste Management has less favorable growth aspects than its peers.
This table compares Waste Management and its peers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Waste Management Competitors||-158.38%||-95.30%||-3.29%|
Earnings & Valuation
This table compares Waste Management and its peers top-line revenue, earnings per share and valuation.
|Gross Revenue||Net Income||Price/Earnings Ratio|
|Waste Management||$14.49 billion||$1.95 billion||19.10|
|Waste Management Competitors||$3.01 billion||$232.83 million||30.02|
Waste Management has higher revenue and earnings than its peers. Waste Management is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.
Waste Management beats its peers on 10 of the 15 factors compared.
About Waste Management
Waste Management, Inc., through its subsidiaries, provides waste management environmental services to residential, commercial, industrial, and municipal customers in North America. It provides 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, 2017, the company owned or operated 244 solid waste landfills; 5 secure hazardous waste landfills; 90 MRFs; and 305 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. Further, it portable self-storage and long distance moving services; fluorescent bulb and universal waste mail-back services through LampTracker program; portable restroom services under the Port-o-Let name; and street and parking lot sweeping services, as well as holds interests in oil and gas producing properties. 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.
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