WM
Waste Management, Inc.$243.95
Unclear
Target $236.96
Report: Mar 07, 2026Industrials • Waste Management • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$243.95-2.9%
Rec: UnclearConviction: High
Entry Target
$182.28
(25% below current)
Fair Value
$236.96
(3% below current)
Stop Loss
$145.82
(40% below current)
Position Size
Half
Time Horizon
Long-Term
Key Metrics
Live Snapshot
Market Data
52 Week High$248.13
52 Week Low$194.11
Avg. 3 Month Volume2.24M
Efficiency
LTM Gross Margin40.4%
LTM EBITDA Margin28.6%
LTM EBIT Margin17.2%
LTM Operating Margin17.1%
LTM ROA6.0%
LTM ROE29.0%
LTM ROIC9.6%
LTM ROCE11.0%
Capital Structure
Market Cap (MM)$92.7B
Enterprise Value (MM)$115.4B
Shares Outstanding403.34M
Total Debt (MM)$22.91B
Cash & Equivalents (MM)$201.00M
LTM Net Debt (MM)$22.71B
LTM Net Debt/EBITDA3.2x
Growth
TTM Rev. Growth14.2%
Last 3-Yr Rev. CAGR8.6%
Last 3-Yr EBITDA CAGR10.5%
Last 3-Yr EPS CAGR7.4%
Valuation
Street Target Price$253.75
LTM EV/Revenue4.6x
LTM EV/Gross Profit11.3x
LTM EV/EBIT26.6x
LTM EV/EBITDA16.0x
LTM P/E34.2x
LTM EV/FCF41.0x
LTM P/FCF32.9x
LTM P/TB3.3x
LTM P/B9.3x
Dividend Yield1.4%
Payout Ratio49.2%
Executive SummarySituation: Current price is $243.95 versus fair value $236.96 (-2.9% expected return), and valuation confidence is stable. Debate: Bull case depends on Stericycle synergies reaching $250M run-rate by 2027 with Healthcare SG&A below 15% validates moat expansion into regulated medical waste, addressing market concerns on integration costs exceeding $150M accretion in 2026. Bear case centers on Moat erosion via technological disruption or new low-cost entrants impairing pricing power, as regulated landfills face PFAS leachate liabilities forcing remediation costs. Conclusion: Recommendation is Unclear; maintain no position until reliability and catalyst evidence improve.
Bull Case
1. Network moat of 257 landfills drives 9.6% ROIC >6.6% peer median with 40.4% gross margins 2.5ppt above peers, enabling sustained 5-6% pricing-led growth. 2. Sustainability ramp with 7 RNG sites doubling 2026 production at $24.50/MMBtu and Stericycle synergies of $250M by 2027 lift FCF 30% to $3.8B midpoint. 3. Cash conversion at 2.23x supports $3.5B returns including 14.5% dividend hike.
Bear Case
1. Negative incremental ROIC of -0.5% trails 9.5% WACC on $13.8B CapEx and 0.4x M&A effectiveness eroding returns. 2. Margin compression with operating at 17.1% (-130bps YoY) from $912M interest and Healthcare SG&A at 20.8%. 3. Insider net sales of $46.7M signal caution amid PFAS leachate liabilities.
Key Catalysts
Mid-Term (6-18 months)Impact: High
Stericycle synergies reaching $250M run-rate by 2027 with Healthcare SG&A below 15% validates moat expansion into regulated medical waste, a...
Near-Term (0-6 months)Impact: Moderate
RNG production doubling in 2026 from 7 new facilities with 60% volume contracted at $24.50/MMBtu reinforces sustainability moat amid commodi...
Long-Term (18+ months)Impact: Moderate
WM trades near 52-week high of $244.88 after +6.15% on FY2025 results with record 30.1% margins, but integration risks linger ahead of Inves...
Primary Risks
Concern: Medium
Moat erosion via technological disruption or new low-cost entrants impairing pricing power, as regulated landfills face PFAS leachate liabil...
Concern: High
Execution failure in Stericycle integration sustains SG&A above 20%, compressing overall margins below 17%.
Concern: Medium
Stewardship is strong with independent Chair Kathleen M. Mazzarella overseeing M&A via EVP Boettcher (Stericycle architect) and Audit Chair...
Recent Activity
2025-01-30SEC Filing (8-K)
+6.15%WM reported strong 2024 financial results with record operating EBITDA and margin, completed Stericycle acquisition, and provided 2025 outlook for significant revenue and earnings growth.
2024-10-29SEC Filing (8-K)
+5.21%Waste Management reports record Q3 2024 financial results
2024-07-25SEC Filing (8-K)
-8.03%WM reports Q2 2024 earnings with 5.5% revenue growth and record 30.0% adjusted operating EBITDA margin.
2024-02-13SEC Filing (8-K)
+5.97%WM reports Q4 2023 earnings with 15% adjusted operating EBITDA growth and 29.9% margin, raising 2024 guidance.
2023-10-25SEC Filing (8-K)
+6.10%Waste Management reports strong Q3 2023 financial results
Valuation Table
9.8/10Decision Grade
Scenario Range
$173
Bear
$4
Base
$274
Bull
$244