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Waste Management (WM) Gains But Lags Market: What You Should Know

In the latest trading session, Waste Management (WM) closed at $116.08, marking a +0.06% move from the previous day. The stock lagged the S&P 500's daily gain of 0.49%. Elsewhere, the Dow gained 0.57%, while the tech-heavy Nasdaq added 0.67%.

Prior to today's trading, shares of the garbage and recycling hauler had gained 4.27% over the past month. This has outpaced the Business Services sector's gain of 0.56% and the S&P 500's gain of 3.03% in that time.

Wall Street will be looking for positivity from WM as it approaches its next earnings report date. The company is expected to report EPS of $1.13, unchanged from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $3.95 billion, up 2.73% from the prior-year quarter.

Investors should also note any recent changes to analyst estimates for WM. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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. WM is currently a Zacks Rank #3 (Hold).

Investors should also note WM's current valuation metrics, including its Forward P/E ratio of 24.92. For comparison, its industry has an average Forward P/E of 25.63, which means WM is trading at a discount to the group.

Investors should also note that WM has a PEG ratio of 3.02 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Waste Removal Services industry currently had an average PEG ratio of 3.06 as of yesterday's close.

The Waste Removal Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 43, which puts it in the top 17% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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