WASTE CONNECTIONS INC (WCN) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:WCN - CA94106B1013 - Common Stock
163.06 USD
-3.16 (-1.9%)
163.06 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to WCN. WCN was compared to 80 industry peers in the Commercial Services & Supplies industry. WCN has an excellent profitability rating, but there are concerns on its financial health. WCN is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
WCN had positive earnings in the past year.
In the past year WCN had a positive cash flow from operations.
WCN had positive earnings in each of the past 5 years.
In the past 5 years WCN always reported a positive cash flow from operatings.
1.2 Ratios
WCN's Return On Assets of 2.99% is fine compared to the rest of the industry. WCN outperforms 62.50% of its industry peers.
WCN's Return On Equity of 7.69% is fine compared to the rest of the industry. WCN outperforms 65.00% of its industry peers.
With a decent Return On Invested Capital value of 7.55%, WCN is doing good in the industry, outperforming 67.50% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for WCN is below the industry average of 10.54%.
The last Return On Invested Capital (7.55%) for WCN is above the 3 year average (7.10%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.99% | ||
| ROE | 7.69% | ||
| ROIC | 7.55% |
ROA(3y)4.08%
ROA(5y)3.58%
ROE(3y)9.84%
ROE(5y)8.27%
ROIC(3y)7.1%
ROIC(5y)6.62%
1.3 Margins
Looking at the Profit Margin, with a value of 6.65%, WCN is in the better half of the industry, outperforming 77.50% of the companies in the same industry.
In the last couple of years the Profit Margin of WCN has declined.
Looking at the Operating Margin, with a value of 19.06%, WCN belongs to the top of the industry, outperforming 91.25% of the companies in the same industry.
In the last couple of years the Operating Margin of WCN has grown nicely.
Looking at the Gross Margin, with a value of 42.10%, WCN is in the better half of the industry, outperforming 76.25% of the companies in the same industry.
In the last couple of years the Gross Margin of WCN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.06% | ||
| PM (TTM) | 6.65% | ||
| GM | 42.1% |
OM growth 3Y2.81%
OM growth 5Y2.48%
PM growth 3Y-11.67%
PM growth 5Y-8.02%
GM growth 3Y0.97%
GM growth 5Y0.56%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WCN is destroying value.
Compared to 1 year ago, WCN has about the same amount of shares outstanding.
Compared to 5 years ago, WCN has less shares outstanding
WCN has a worse debt/assets ratio than last year.
2.2 Solvency
WCN has an Altman-Z score of 3.04. This indicates that WCN is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.04, WCN is in the better half of the industry, outperforming 67.50% of the companies in the same industry.
WCN has a debt to FCF ratio of 6.99. This is a slightly negative value and a sign of low solvency as WCN would need 6.99 years to pay back of all of its debts.
WCN has a Debt to FCF ratio of 6.99. This is in the better half of the industry: WCN outperforms 67.50% of its industry peers.
A Debt/Equity ratio of 1.07 is on the high side and indicates that WCN has dependencies on debt financing.
The Debt to Equity ratio of WCN (1.07) is worse than 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 6.99 | ||
| Altman-Z | 3.04 |
ROIC/WACC0.95
WACC7.98%
2.3 Liquidity
A Current Ratio of 0.67 indicates that WCN may have some problems paying its short term obligations.
WCN has a Current ratio of 0.67. This is amonst the worse of the industry: WCN underperforms 85.00% of its industry peers.
A Quick Ratio of 0.67 indicates that WCN may have some problems paying its short term obligations.
The Quick ratio of WCN (0.67) is worse than 81.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.67 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.91% over the past year.
The Earnings Per Share has been growing by 11.90% on average over the past years. This is quite good.
WCN shows a small growth in Revenue. In the last year, the Revenue has grown by 7.58%.
Measured over the past years, WCN shows a quite strong growth in Revenue. The Revenue has been growing by 10.60% on average per year.
EPS 1Y (TTM)5.91%
EPS 3Y14.04%
EPS 5Y11.9%
EPS Q2Q%6.67%
Revenue 1Y (TTM)7.58%
Revenue growth 3Y13.19%
Revenue growth 5Y10.6%
Sales Q2Q%5.13%
3.2 Future
The Earnings Per Share is expected to grow by 9.98% on average over the next years. This is quite good.
Based on estimates for the next years, WCN will show a small growth in Revenue. The Revenue will grow by 6.76% on average per year.
EPS Next Y8.43%
EPS Next 2Y9.61%
EPS Next 3Y11.01%
EPS Next 5Y9.98%
Revenue Next Year6.33%
Revenue Next 2Y6.05%
Revenue Next 3Y6.2%
Revenue Next 5Y6.76%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 32.48, WCN can be considered very expensive at the moment.
WCN's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of WCN to the average of the S&P500 Index (27.25), we can say WCN is valued inline with the index average.
The Price/Forward Earnings ratio is 28.33, which means the current valuation is very expensive for WCN.
The rest of the industry has a similar Price/Forward Earnings ratio as WCN.
WCN's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.48 | ||
| Fwd PE | 28.33 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of WCN is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WCN is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.82 | ||
| EV/EBITDA | 16.92 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
WCN has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.85
PEG (5Y)2.73
EPS Next 2Y9.61%
EPS Next 3Y11.01%
5. Dividend
5.1 Amount
With a yearly dividend of 0.78%, WCN is not a good candidate for dividend investing.
WCN's Dividend Yield is a higher than the industry average which is at 0.88.
Compared to an average S&P500 Dividend Yield of 1.92, WCN's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.78% |
5.2 History
On average, the dividend of WCN grows each year by 12.03%, which is quite nice.
WCN has paid a dividend for at least 10 years, which is a reliable track record.
WCN has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)12.03%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
52.24% of the earnings are spent on dividend by WCN. This is a bit on the high side, but may be sustainable.
WCN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP52.24%
EPS Next 2Y9.61%
EPS Next 3Y11.01%
163.06
-3.16 (-1.9%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners89.12%
Inst Owner Change0.08%
Ins Owners0.11%
Ins Owner Change-1.66%
Market Cap41.75B
Revenue(TTM)9.35B
Net Income(TTM)622.05M
Analysts84.21
Price Target148.96 (-8.65%)
Short Float %0.94%
Short Ratio2.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.78% |
Yearly Dividend1.17
Dividend Growth(5Y)12.03%
DP52.24%
Div Incr Years3
Div Non Decr Years3
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.57%
Min EPS beat(2)2.03%
Max EPS beat(2)3.11%
EPS beat(4)3
Avg EPS beat(4)0.47%
Min EPS beat(4)-5.03%
Max EPS beat(4)3.11%
EPS beat(8)7
Avg EPS beat(8)1.66%
EPS beat(12)9
Avg EPS beat(12)1.16%
EPS beat(16)12
Avg EPS beat(16)1.4%
Revenue beat(2)0
Avg Revenue beat(2)-0.52%
Min Revenue beat(2)-0.59%
Max Revenue beat(2)-0.45%
Revenue beat(4)0
Avg Revenue beat(4)-0.51%
Min Revenue beat(4)-0.75%
Max Revenue beat(4)-0.25%
Revenue beat(8)2
Avg Revenue beat(8)-0.18%
Revenue beat(12)3
Avg Revenue beat(12)-0.28%
Revenue beat(16)6
Avg Revenue beat(16)-0.06%
PT rev (1m)1.22%
PT rev (3m)-26.84%
EPS NQ rev (1m)-0.14%
EPS NQ rev (3m)-1.11%
EPS NY rev (1m)-0.06%
EPS NY rev (3m)0.69%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.33%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.01%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.48 | ||
| Fwd PE | 28.33 | ||
| P/S | 4.46 | ||
| P/FCF | 33.82 | ||
| P/OCF | 17.21 | ||
| P/B | 5.16 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.92 |
EPS(TTM)5.02
EY3.08%
EPS(NY)5.75
Fwd EY3.53%
FCF(TTM)4.82
FCFY2.96%
OCF(TTM)9.48
OCFY5.81%
SpS36.54
BVpS31.61
TBVpS-8.54
PEG (NY)3.85
PEG (5Y)2.73
Graham Number59.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.99% | ||
| ROE | 7.69% | ||
| ROCE | 9.54% | ||
| ROIC | 7.55% | ||
| ROICexc | 7.6% | ||
| ROICexgc | 17.01% | ||
| OM | 19.06% | ||
| PM (TTM) | 6.65% | ||
| GM | 42.1% | ||
| FCFM | 13.2% |
ROA(3y)4.08%
ROA(5y)3.58%
ROE(3y)9.84%
ROE(5y)8.27%
ROIC(3y)7.1%
ROIC(5y)6.62%
ROICexc(3y)7.13%
ROICexc(5y)6.71%
ROICexgc(3y)16.04%
ROICexgc(5y)15.16%
ROCE(3y)8.97%
ROCE(5y)8.36%
ROICexgc growth 3Y4.71%
ROICexgc growth 5Y6.27%
ROICexc growth 3Y5.49%
ROICexc growth 5Y5.39%
OM growth 3Y2.81%
OM growth 5Y2.48%
PM growth 3Y-11.67%
PM growth 5Y-8.02%
GM growth 3Y0.97%
GM growth 5Y0.56%
F-Score6
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 6.99 | ||
| Debt/EBITDA | 2.86 | ||
| Cap/Depr | 96.51% | ||
| Cap/Sales | 12.74% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.4% | ||
| Profit Quality | 198.46% | ||
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.67 | ||
| Altman-Z | 3.04 |
F-Score6
WACC7.98%
ROIC/WACC0.95
Cap/Depr(3y)94.39%
Cap/Depr(5y)92.61%
Cap/Sales(3y)12.05%
Cap/Sales(5y)12.09%
Profit Quality(3y)159.7%
Profit Quality(5y)199.37%
High Growth Momentum
Growth
EPS 1Y (TTM)5.91%
EPS 3Y14.04%
EPS 5Y11.9%
EPS Q2Q%6.67%
EPS Next Y8.43%
EPS Next 2Y9.61%
EPS Next 3Y11.01%
EPS Next 5Y9.98%
Revenue 1Y (TTM)7.58%
Revenue growth 3Y13.19%
Revenue growth 5Y10.6%
Sales Q2Q%5.13%
Revenue Next Year6.33%
Revenue Next 2Y6.05%
Revenue Next 3Y6.2%
Revenue Next 5Y6.76%
EBIT growth 1Y4.81%
EBIT growth 3Y16.36%
EBIT growth 5Y13.35%
EBIT Next Year77.97%
EBIT Next 3Y27.4%
EBIT Next 5Y19.22%
FCF growth 1Y4.33%
FCF growth 3Y7.13%
FCF growth 5Y6.05%
OCF growth 1Y15.9%
OCF growth 3Y9.49%
OCF growth 5Y7.67%
WASTE CONNECTIONS INC / WCN FAQ
What is the ChartMill fundamental rating of WASTE CONNECTIONS INC (WCN) stock?
ChartMill assigns a fundamental rating of 5 / 10 to WCN.
What is the valuation status of WASTE CONNECTIONS INC (WCN) stock?
ChartMill assigns a valuation rating of 2 / 10 to WASTE CONNECTIONS INC (WCN). This can be considered as Overvalued.
What is the profitability of WCN stock?
WASTE CONNECTIONS INC (WCN) has a profitability rating of 7 / 10.
What are the PE and PB ratios of WASTE CONNECTIONS INC (WCN) stock?
The Price/Earnings (PE) ratio for WASTE CONNECTIONS INC (WCN) is 32.48 and the Price/Book (PB) ratio is 5.16.
Can you provide the dividend sustainability for WCN stock?
The dividend rating of WASTE CONNECTIONS INC (WCN) is 4 / 10 and the dividend payout ratio is 52.24%.