Waste collection and disposal industry leader WM enjoys leading market share and unmatched dominance in landfill ownership, which is nearly impossible to replicate given immense regulatory hurdles. This leadership position expanded after the firm's October 2020 acquisition of Advanced Disposal, which had been the fourth-largest publicly traded waste collection and disposal company in the United States.
WM has a stable business model and enjoys a wide economic moat rooted in intangible assets (regulatory permits for landfills) and cost advantages (route density).
It is becoming increasingly difficult to find quality tuck-in acquisitions that move the needle for WM, which opens up the temptation to overspend on a large, complex and/or noncore transactions.
|
Metric
|
WM
|
RSG
|
WCN
|
|---|---|---|---|
Price/Earnings (Normalized) | 31.75 | 32.38 | 38.28 |
Price/Book Value | 11.93 | 5.48 | 5.50 |
Price/Sales | 4.13 | 3.90 | 5.24 |
Price/Cash Flow | 16.47 | 15.88 | 19.63 |
|
Metric
|
WM
|
RSG
|
WCN
|
|---|---|---|---|
Quick Ratio | 0.79 | 0.46 | 0.62 |
Current Ratio | 0.90 | 0.53 | 0.75 |
Interest Coverage | 7.04 | 5.34 | 4.55 |
|
Metric
|
WM
|
RSG
|
WCN
|
|---|---|---|---|
Return on Assets (Normalized) | 7.92% | 6.06% | 6.05% |
Return on Equity (Normalized) | 36.61% | 17.75% | 14.32% |
Return on Invested Capital (Normalized) | 12.95% | 9.80% | 8.75% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|
RSG
| Republic Services Inc | Rtqhjswvz | Nmzv | $59.2 Bil | |
WCN
| Waste Connections Inc | Hwdkhlsfy | Fykrz | $42.7 Bil | |
VEOEF
| Veolia Environnement SA | — | Yhbfkj | $22.6 Bil | |
VEOEY
| Veolia Environnement SA ADR | Pqkbvgb | Mvkfsyg | $22.6 Bil | |
GFL
| GFL Environmental Inc | — | Crnfczn | $12.6 Bil | |
CLH
| Clean Harbors Inc | Zclgwqnld | Ltzhsfk | $11.3 Bil | |
FMOCY
| Fomento de Construcciones y Contratas SA ADR | — | Kvjcl | $6.3 Bil | |
FMOCF
| Fomento de Construcciones y Contratas SA | — | Wfnf | $6.1 Bil | |
SRCL
| Stericycle Inc | Fthbgyz | Mrqfmqc | $4.4 Bil |
