Waste Connections (WCN) Stock Down 5.4% Since Q1 Earnings Beat

Waste Connections, Inc. WCN stock has lost 5.4% since its first-quarter 2022 earnings release on May 3. The downfall can be attributed to lower-than-expected earnings performance.

Zacks Investment Research

Image Source: Zacks Investment Research

Adjusted earnings of 82 cents per share missed the Zacks Consensus Estimate by 1.2% but increased 17.1% year over year. Revenues of $1.65 billion topped the consensus mark by 1.9% and rose 17.9% year over year.

Acquisitions contributed $110.01 million to revenues in the reported quarter.

Revenues by Segment

The Solid Waste Collection segment’s revenues increased 15.8% year over year to $1.20 billion.

The Solid Waste Disposal and Transfer segment’s revenues increased 12.5% from the year-ago quarter’s level to $304.7 million.

The Solid Waste Recycling segment’s revenues surged 92.4% year over year to $60.5 million.

The Intermodal and Other segment’s revenues increased 22.7% to $35.58 million.

The E&P Waste Treatment, Recovery and Disposal segment’s revenues soared 65.5% from the year-ago quarter’s level to $40.8 million.

Operating Results

Adjusted EBITDA in the reported quarter was $502.12 million, up 15.9% from the year-ago quarter’s level. Adjusted EBITDA margin came in at 30.5% compared with 31% in the year-ago quarter.

Operating income totaled $273.86 million, up 14.9% from the prior-year quarter.

Waste Connections, Inc. Price, Consensus and EPS Surprise

Waste Connections, Inc. Price, Consensus and EPS Surprise

Waste Connections, Inc. price-consensus-eps-surprise-chart | Waste Connections, Inc. Quote

Balance Sheet and Cash Flow

Waste Connections exited first-quarter 2022 with cash and cash equivalents of $391.42 million compared with $147.44 million at the end of the prior quarter. Long-term debt was $5.82 billion compared with $5.04 billion at the end of the last-reported quarter.

The company generated $440.89 million of cash from operating activities in the reported quarter. Adjusted free cash flow was $320.38 million. Capital expenditures totaled $152.32 million.

WCN paid out dividends worth $59.39 million in the reported quarter.

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

Performance of Other Business Services Companies

Omnicom Group OMC reported impressive first-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.

Omnicom’s earnings of $1.39 per share beat the consensus mark by 8.6% and increased 4.5% year over year, driven by strong margin performance.

Omnicom’s total revenues of $3.4 billion surpassed the consensus estimate by 5.4% but declined slightly year over year.

Equifax EFX reported better-than-expected first-quarter 2022 results.

Equifax’s adjusted earnings of $2.22 per share beat the Zacks Consensus Estimate by 3.3% and improved 13% on a year-over-year basis. The reported figure exceeded the guided range of $2.08-$2.18.

Equifax’s revenues of $1.36 billion outpaced the consensus estimate by 2.4% and improved 12.4% year over year on a reported basis and 13% on a local-currency basis. The reported figure exceeded the guided range of $1.32-$1.34 billion.

Waste Management WM reported solid first-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.

Waste Management’s adjusted earnings per share of $1.29 beat the Zacks Consensus Estimate by 15.2% and improved 21.7% year over year.

Waste Management’s total revenues of $4.66 billion beat the consensus estimate by 4.6% and increased 13.4% year over year.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Omnicom Group Inc. (OMC) : Free Stock Analysis Report

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

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

Waste Connections, Inc. (WCN) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research