Is Waste Management Inc. (WM) A Good Investment?

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TMC
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Waste Management Inc. (NYSE:WM) finished Thursday with a subtraction of -$1.02 to close at $165.85, a downside of -0.61 percent. An average of 1,457,900 shares of common stock have been traded in the last five days. There was a fall of -$4.23 in the past week, and it reached a new high 21 times over the past 12 months. The last 20 days have seen an average of 1,715,525 shares traded, while the 50-day average volume stands at 1,542,826.

WM stock has decreased by -3.78% in the last month. The company shares reached their 1-month lowest point of $164.21 on 09/23/22. With the stock rallying to its 52-week high on 08/18/22, shares of the company touched a low of $138.58 and a high of $175.98 in 52 weeks. It has reached a new high 10 times so far this year and lost -0.02% or -$1.79 in price. In spite of this, the price is down -5.76% from the 52-week high.


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Insider Transactions

38 days have passed since Waste Management Inc. (WM) last reported insider trading activity. Rankin Devina A, who is EVP & CFO, most recently acquired $22,082 shares at $175.00 per share on Aug 16. In this transaction, the insider spent $3,864,350. Sr. VP-Chief Customer Officer, Watson Michael J., disposed of 8,971 shares at a price of $169.83 on Aug 11. The insider now owns more than $1,523,522 worth of shares. Prior to that, EVP & Chief Operation Officer Morris John J went on to Sale 22,795 shares at $169.82 each on Aug 09. An amount of $3,871,154 was transacted.

Valuation Metrics

Waste Management Inc. (WM) has a trailing price-to-earnings (P/E) ratio of 32.62. The stock’s beta is 0.76. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 3.66, the price-to-book (PB) ratio at 9.62, and the price-to-cash flow ratio at 55.77.

The company has a payout ratio of 47.60%. The company’s most recent quarterly dividend payment was $0.65 a share, without any change from last year. Its latest increase dividend $0.0750 reported on Tuesday March 1 2022.

Financial Health

The quick ratio of Waste Management Inc. for the three months ended June 29 was 1.00, and the current ratio was 1.10, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 1.95 and a total debt to equity ratio of 1.99 for the quarter ending June 29. Its gross profit as reported stood at $6.82 billion compared to revenue of $17.93 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Waste Management Inc.’s return on assets was 7.30%.

Earnings Surprise

For the three-month period that ended June 29, Waste Management Inc. had $14.05 billion in total debt. In the quarter under review, the net income was up than the previous quarter. The company posted a net income of $587.0 million in the quarter, while revenues were grew 40.2%. The analyst consensus anticipated Waste Management Inc.’s latest quarter earnings to come in at $1.4 per share, but it turned out to be $1.44, a 2.90% surprise. For the quarter, EBITDA amounted to $1.43 billion. Shareholders own equity worth $413.34 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Waste Management Inc. (WM) price momentum. RSI 9-day as of the close on 22 September was 28.03%, suggesting the stock is oversold, with historical volatility in this time frame at 10.42%.

As of today, WM’s price is $168.30 -2.50% or -$4.23 from its 5-day moving average. WM is currently trading -5.45% lower than its 20-day SMA and +3.82% higher than its 100-day SMA. However, the stock’s current price level is +9.29% above the SMA50 and +0.52% above the SMA200.

The stochastic %K and %D were 9.27% and 18.00%, respectively, and the average true range (ATR) was 2.75. With the 14-day stochastic at 8.55% and the average true range at 2.69, the RSI (14) stands at 36.87%. The stock has reached -2.46 on the 9-day MACD Oscillator while the 14-day reading was at -3.64.

Analyst Ratings

BofA Securities upgraded Waste Management Inc. (NYSE: WM) to a a Neutral rating in its most recent analyst report. Previously, the stock was rated as an Underperform. The consensus rating for Waste Management Inc. (WM) among analysts is Overweight. According to current brokerage recommendations, 0 brokerage firms advise that investors sell WM, while 11 suggest investors hold. There are 1 analyst who rate the stock as underweight. The stock is rated overweight by 2 analysts, while 6 others rate it as a “buy”.

What is WM’s price target for the next 12 months?

Analysts predict a range of price targets between $163.00 and $198.00, with a median target of $170.00. Taking a look at these predictions, the average price target given by analysts for Waste Management Inc. (WM) stock is $172.94.

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