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Core Initiatives Aid Waste Management (WM), High Debt Ails

We have recently updated a report on Waste Management, Inc. WM.

The company recently reported solid first-quarter 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Adjusted earnings per share (EPS) of $1.06 beat the Zacks Consensus Estimate by 6% and increased 13.9% year over year. Total revenues of $4.11 billion beat the consensus estimate by 1.8% and rose 10.3% year over year.

Notably, the stock has gained 42% in the past year compared with 35.5% rally of the industry it belongs to.

The waste management industry is poised to benefit from growing adoption of advanced waste collection and recycling techniques. Increasing environmental concerns, rapid industrialization, increase in population and expected increase in non-hazardous waste due to rapid economic growth are expected to enhance business opportunities for waste management.

Additionally, the company continues to execute core operating initiatives targeting focused differentiation and continuous improvement as well as instil price and cost discipline to achieve better margins.

Meanwhile, Waste Management’s cash and cash equivalent balance of $476 million at the end of first-quarter 2021 was well below the long-term debt level of $13.2 billion. This underscores that the company doesn’t have enough cash to meet the debt burden. The cash level, however, can meet the short-term debt of $244 million.

Zacks Rank and Stocks to Consider

Waste Management currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the broader Zacks Business Services sector are ExlService EXLS, Equifax EFX and TransUnion TRU, each carrying a Zacks Rank #2 (Buy).

The long-term expected EPS (three to five years) growth rate for ExlService, Equifax and TransUnion is pegged at 10.8%, 14% and 20.9%, respectively.

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Equifax, Inc. (EFX) : Free Stock Analysis Report

Waste Management, Inc. (WM) : Free Stock Analysis Report

ExlService Holdings, Inc. (EXLS) : Free Stock Analysis Report

TransUnion (TRU) : Free Stock Analysis Report

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