Waste Management (WM) Stock Analysis

Next time you take your trash out or see your neighbor’s cans on the side of the garage/house – I hope you now think of dividend investing. This dividend stock analysis proudly brings Waste Management (WM) to the forefront this summer. We performed a dividend stock analysis on this company and industry competition to see if they appear to be or appear not to be attractive for a stock purchase. Time to dumpster dive into the stock!

The Stock – Waste Management (WM)

I was driving around my neighborhood and was surrounded by a few waste disposal service trucks, massive trucks, that is. I though to myself, wow, my one neighborhood has a TON of trash sitting in their cans and bags outside of their home, what a business that is a complete annuity for the owners. Then it hit me – when would this business model slow down? If our consumption continues to increase and our waste per household continues to receive intense scrutiny (we waste a ton of food, products, etc., trust me), what a business to be an owner in! Yes, it was the green/white/yellow truck from Waste Management, that my eyes had seen. I was curious – how BIG is their business? Well… based on last quarter’s earnings release, they had $3.44B of top-line revenue, which on an annual basis is projected to be over $12B in annual revenue. Heck, free cash flow is almost $400M! Talk about a business model that is a pure cash cow. Are homes decreasing? No. Are we consuming less? Typically no, but I feel like I am, heck I only have one bag of trash every two weeks roughly, which I know I am a rarity and I do only live, currently, by myself; however, with the family next door – I typically see 4-6 bags of garbage, WOW.

You can tell, the intrigue really had my investment research blood boiling here. Who else is there? I wanted to find out the competition, the dividend metrics that we typically use and to see if it looks like an investment in an over-valued stock market place. I wanted to see if Waste Management, took the other competition to the curb and “disposed” of them with their financial metrics! It was time to take the trash through the Dividend Diplomat Stock screener to see the results that “spit” out.