Waste Management (WM) Outpaces Stock Market Gains: What You Should Know

Waste Management (WM) closed the most recent trading day at $155.65, moving +1.75% from the previous trading session. This move outpaced the S&P 500's daily gain of 1.06%. At the same time, the Dow added 1.05%, and the tech-heavy Nasdaq gained 0.55%.

Heading into today, shares of the garbage and recycling hauler had lost 4.02% over the past month, outpacing the Business Services sector's loss of 8.97% and the S&P 500's loss of 8.3% in that time.

Waste Management will be looking to display strength as it nears its next earnings release. On that day, Waste Management is projected to report earnings of $1.11 per share, which would represent a year-over-year decline of 12.6%. Meanwhile, our latest consensus estimate is calling for revenue of $4.84 billion, up 8.12% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.55 per share and revenue of $19.39 billion, which would represent changes of +14.67% and +8.13%, respectively, from the prior year.

Any recent changes to analyst estimates for Waste Management should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Waste Management is currently a Zacks Rank #2 (Buy).

Digging into valuation, Waste Management currently has a Forward P/E ratio of 27.58. This represents a premium compared to its industry's average Forward P/E of 18.79.

Also, we should mention that WM has a PEG ratio of 2.54. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Waste Removal Services industry currently had an average PEG ratio of 2.54 as of yesterday's close.

The Waste Removal Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 48, putting it in the top 19% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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