Shares of Waste Management (WM, Financial) soared by 5.32% today, driven by the company's impressive financial results in its recently released fourth-quarter and full-year earnings report. This positive momentum highlights the company's strong performance and growth potential.
In the fourth-quarter and 2024 earnings report, Waste Management (WM, Financial) reported a 13% increase in revenue for the quarter and an 8% increase for the year. Additionally, net income surged by 21% in Q4 and 19% for the full year. The company's free cash flow for 2024 also saw a notable rise of 22%, reflecting robust financial health and operational efficiency.
Waste Management has expanded its portfolio through strategic acquisitions, including the $7.2 billion purchase of Stericycle, a leading medical waste management company in North America. This acquisition has allowed Waste Management to enter a new market and establish two reporting segments: WM legacy business and WM healthcare solutions.
The company announced a 10% dividend increase in December, marking its 22nd consecutive year of dividend growth, with the next payment expected in March. This consistent dividend growth underscores Waste Management's commitment to delivering shareholder value.
Looking ahead, Waste Management projects nearly 16% revenue growth in 2025, primarily driven by acquisitions. The company anticipates increased margins across both segments and expects an 18% growth in free cash flow, based on its guidance. Importantly, Waste Management has revised its forecast for synergies from the Stericycle acquisition to $250 million by 2027, doubling the original estimate.
From an investment perspective, Waste Management (WM, Financial) is currently trading at $220.70, with a market capitalization of $88.58 billion. The stock's price-to-earnings (P/E) ratio stands at 33.75, and the price-to-book (P/B) ratio at 11.1, both indicating a premium valuation. The company's GF Value, as assessed by experts, suggests that the stock is fairly valued with a GF Value of $199.25. For more details, please visit the GF Value page.
Despite being near its 10-year high, Waste Management's PEG ratio of 3.7 and its predictability rank of 3.5 reflect a solid financial footing and a healthy growth trajectory. Additionally, the company's financial strength is highlighted by a strong Altman Z-score of 3.48 and a high Piotroski F-score of 8. These indicators suggest that Waste Management is well-positioned to continue its growth momentum, driven by strategic acquisitions and robust operational efficiencies.
