WASTE CONNECTIONS INC (WCN) Stock Fundamental Analysis
USA - NYSE:WCN - CA94106B1013 - Common Stock
176.81 USD
-1.66 (-0.93%)
176.81 USD
0 (0%)
Overall WCN gets a fundamental rating of 5 out of 10. We evaluated WCN against 82 industry peers in the Commercial Services & Supplies industry. While WCN has a great profitability rating, there are quite some concerns on its financial health. WCN is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year WCN was profitable.
In the past year WCN had a positive cash flow from operations.
Each year in the past 5 years WCN has been profitable.
In the past 5 years WCN always reported a positive cash flow from operatings.
1.2 Ratios
WCN's Return On Assets of 3.11% is fine compared to the rest of the industry. WCN outperforms 63.41% of its industry peers.
WCN has a better Return On Equity (7.71%) than 64.63% of its industry peers.
WCN's Return On Invested Capital of 7.49% is fine compared to the rest of the industry. WCN outperforms 67.07% of its industry peers.
WCN had an Average Return On Invested Capital over the past 3 years of 7.10%. This is below the industry average of 10.38%.
The 3 year average ROIC (7.10%) for WCN is below the current ROIC(7.49%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.11% | ||
| ROE | 7.71% | ||
| ROIC | 7.49% |
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
The Profit Margin of WCN (6.97%) is better than 76.83% of its industry peers.
WCN's Profit Margin has declined in the last couple of years.
WCN has a better Operating Margin (19.12%) than 92.68% of its industry peers.
WCN's Operating Margin has improved in the last couple of years.
With a decent Gross Margin value of 42.03%, WCN is doing good in the industry, outperforming 74.39% of the companies in the same industry.
WCN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.12% | ||
| PM (TTM) | 6.97% | ||
| GM | 42.03% |
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
WCN has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
WCN has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for WCN has been reduced compared to 5 years ago.
Compared to 1 year ago, WCN has a worse debt to assets ratio.
2.2 Solvency
WCN has an Altman-Z score of 3.23. 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 3.23, WCN is in the better half of the industry, outperforming 64.63% of the companies in the same industry.
The Debt to FCF ratio of WCN is 7.32, which is on the high side as it means it would take WCN, 7.32 years of fcf income to pay off all of its debts.
WCN has a Debt to FCF ratio of 7.32. This is in the better half of the industry: WCN outperforms 63.41% of its industry peers.
WCN has a Debt/Equity ratio of 1.00. This is a neutral value indicating WCN is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.00, WCN is doing worse than 64.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 7.32 | ||
| Altman-Z | 3.23 |
ROIC/WACC0.95
WACC7.85%
2.3 Liquidity
WCN has a Current Ratio of 0.67. This is a bad value and indicates that WCN is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of WCN (0.67) is worse than 85.37% of its industry peers.
WCN has a Quick Ratio of 0.67. This is a bad value and indicates that WCN is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.67, WCN is doing worse than 81.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.67 |
3. Growth
3.1 Past
WCN shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.91%.
The Earnings Per Share has been growing by 11.90% on average over the past years. This is quite good.
Looking at the last year, WCN shows a quite strong growth in Revenue. The Revenue has grown by 11.19% in the last year.
The Revenue has been growing by 10.60% on average over the past years. This is quite good.
EPS 1Y (TTM)5.91%
EPS 3Y14.04%
EPS 5Y11.9%
EPS Q2Q%6.67%
Revenue 1Y (TTM)11.19%
Revenue growth 3Y13.19%
Revenue growth 5Y10.6%
Sales Q2Q%5.13%
3.2 Future
Based on estimates for the next years, WCN will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.36% on average per year.
Based on estimates for the next years, WCN will show a small growth in Revenue. The Revenue will grow by 7.45% on average per year.
EPS Next Y7.69%
EPS Next 2Y10.63%
EPS Next 3Y11.52%
EPS Next 5Y11.36%
Revenue Next Year6.34%
Revenue Next 2Y6.64%
Revenue Next 3Y6.78%
Revenue Next 5Y7.45%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
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
The Price/Earnings ratio is 35.22, which means the current valuation is very expensive for WCN.
The rest of the industry has a similar Price/Earnings ratio as WCN.
When comparing the Price/Earnings ratio of WCN to the average of the S&P500 Index (27.67), we can say WCN is valued slightly more expensively.
A Price/Forward Earnings ratio of 30.16 indicates a quite expensive valuation of WCN.
The rest of the industry has a similar Price/Forward Earnings ratio as WCN.
The average S&P500 Price/Forward Earnings ratio is at 23.33. WCN is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.22 | ||
| Fwd PE | 30.16 |
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.
WCN's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 39.86 | ||
| EV/EBITDA | 18.03 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WCN does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of WCN may justify a higher PE ratio.
PEG (NY)4.58
PEG (5Y)2.96
EPS Next 2Y10.63%
EPS Next 3Y11.52%
5. Dividend
5.1 Amount
With a yearly dividend of 0.73%, WCN is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 2.51, WCN pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.35, WCN's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
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
49.38% of the earnings are spent on dividend by WCN. This is a bit on the high side, but may be sustainable.
The dividend of WCN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP49.38%
EPS Next 2Y10.63%
EPS Next 3Y11.52%
176.81
-1.66 (-0.93%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners90.89%
Inst Owner Change-0.02%
Ins Owners0.11%
Ins Owner Change-1.01%
Market Cap45.46B
Revenue(TTM)8.92B
Net Income(TTM)643.83M
Analysts82.22
Price Target203.61 (15.16%)
Short Float %0.74%
Short Ratio1.62
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
Yearly Dividend1.17
Dividend Growth(5Y)12.03%
DP49.38%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.89%
Min EPS beat(2)1.76%
Max EPS beat(2)2.03%
EPS beat(4)3
Avg EPS beat(4)0.3%
Min EPS beat(4)-5.03%
Max EPS beat(4)2.46%
EPS beat(8)7
Avg EPS beat(8)1.43%
EPS beat(12)9
Avg EPS beat(12)1.43%
EPS beat(16)12
Avg EPS beat(16)1.43%
Revenue beat(2)0
Avg Revenue beat(2)-0.6%
Min Revenue beat(2)-0.75%
Max Revenue beat(2)-0.45%
Revenue beat(4)1
Avg Revenue beat(4)-0.15%
Min Revenue beat(4)-0.75%
Max Revenue beat(4)0.84%
Revenue beat(8)2
Avg Revenue beat(8)-0.22%
Revenue beat(12)3
Avg Revenue beat(12)-0.28%
Revenue beat(16)7
Avg Revenue beat(16)0.03%
PT rev (1m)-1.38%
PT rev (3m)-2.35%
EPS NQ rev (1m)-0.44%
EPS NQ rev (3m)-6.29%
EPS NY rev (1m)-0.03%
EPS NY rev (3m)-3.24%
Revenue NQ rev (1m)-0.12%
Revenue NQ rev (3m)-1.63%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.73%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.22 | ||
| Fwd PE | 30.16 | ||
| P/S | 4.92 | ||
| P/FCF | 39.86 | ||
| P/OCF | 19.71 | ||
| P/B | 5.44 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.03 |
EPS(TTM)5.02
EY2.84%
EPS(NY)5.86
Fwd EY3.32%
FCF(TTM)4.44
FCFY2.51%
OCF(TTM)8.97
OCFY5.07%
SpS35.91
BVpS32.49
TBVpS-7.5
PEG (NY)4.58
PEG (5Y)2.96
Graham Number60.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.11% | ||
| ROE | 7.71% | ||
| ROCE | 9.45% | ||
| ROIC | 7.49% | ||
| ROICexc | 7.53% | ||
| ROICexgc | 16.88% | ||
| OM | 19.12% | ||
| PM (TTM) | 6.97% | ||
| GM | 42.03% | ||
| FCFM | 12.35% |
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-Score5
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 7.32 | ||
| Debt/EBITDA | 2.8 | ||
| Cap/Depr | 96.17% | ||
| Cap/Sales | 12.63% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 77.45% | ||
| Profit Quality | 177.13% | ||
| Current Ratio | 0.67 | ||
| Quick Ratio | 0.67 | ||
| Altman-Z | 3.23 |
F-Score5
WACC7.85%
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 Y7.69%
EPS Next 2Y10.63%
EPS Next 3Y11.52%
EPS Next 5Y11.36%
Revenue 1Y (TTM)11.19%
Revenue growth 3Y13.19%
Revenue growth 5Y10.6%
Sales Q2Q%5.13%
Revenue Next Year6.34%
Revenue Next 2Y6.64%
Revenue Next 3Y6.78%
Revenue Next 5Y7.45%
EBIT growth 1Y8.5%
EBIT growth 3Y16.36%
EBIT growth 5Y13.35%
EBIT Next Year78.14%
EBIT Next 3Y28.33%
EBIT Next 5Y19.99%
FCF growth 1Y0.91%
FCF growth 3Y7.13%
FCF growth 5Y6.05%
OCF growth 1Y11.69%
OCF growth 3Y9.49%
OCF growth 5Y7.67%