Waste Management, Inc. WM is currently benefiting from its core operating initiatives and solid liquidity.
WM’s 2022 and 2023 revenues are anticipated to grow 10.1% and 5.9% from the respective year-ago reported figures. WM’s 2022 and 2023 revenues are anticipated to grow 17.8% and 10% from the respective year-ago reported figures.
Factors That Augur Well
Waste Management’s current ratio at the end of third-quarter 2022 was pegged at 0.85, higher than the prior-year quarter’s current ratio of 0.78. Increasing current ratio bodes well as it indicates a company’s efficiency in meeting its short-term debt obligations.
WM continues to execute its core operating initiatives targeting focused differentiation and continuous improvement, and implementing price and cost discipline to achieve better margins. While differentiation through capitalization of extensive assets ensures long-term profitable growth and competitive advantages andcost control help enhance service quality.
A Key Risk
Waste Management operates in a highly competitive and consolidated waste industry. National, regional and local companies give tough competition to WM. Counties and municipalities particularly pose a threat to WM’s market share as these maintain their own waste collection and disposal activities, and benefit from the availability of tax revenues and tax-exempt financing. Price increase becomes difficult in such a fiercely competitive situation, thereby weighing on a company’s top line.
Shares of WM have lost 4.6% in the year-to-date period compared with the 12.7% decline of the industry it belongs to.
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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.
Booz Allen carries a Zacks Rank #2 at present. BAH has a long-term earnings growth expectation of 7.5%.
Booz Allen delivered a trailing four-quarter earnings surprise of 8.8%, on average.
Paychex carries a Zacks Rank of 2 at present. PAYX has a long-term earnings growth expectation of 7.5%.
Paychex delivered a trailing four-quarter earnings surprise of 8.6%, on average.
Cross Country Healthcare sports a Zacks Rank of 1, currently. CCRN has a long-term earnings growth expectation of 6%.
CCRN delivered a trailing four-quarter earnings surprise of 10.1%, on average.
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