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WM: Future Margin Gains From Pricing And Technology Will Drive Upside

WM: Network Expansion And New Leadership Will Drive Upside Momentum

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WM
AnalystConsensusTarget
Not Invested
Published 18 Jul 2024

Update shared on 13 Dec 2025

Fair value Increased 0.16%
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Analysts slightly raised their price target on Waste Management by 0.40 dollars to 246.52 dollars, citing incremental improvements in long term profit margin expectations that more than offset modestly lower revenue growth assumptions and a marginally higher discount rate.

What's in the News

  • Management reiterated its focus on pricing strategies and technology investments to enhance customer lifetime value and optimize the cost structure, while actively pursuing tuck in acquisitions to expand its network and increase internalization (company comments).
  • The company confirmed 2025 revenue guidance at approximately 25.275 billion dollars, at the low end of its prior range, reflecting weaker recycled commodity pricing and softer expectations from WM Healthcare Solutions (company guidance).

Valuation Changes

  • Fair Value Estimate has risen slightly from 246.12 dollars to 246.52 dollars, reflecting a modest upward revision to intrinsic value.
  • Discount Rate has increased marginally from 7.38 percent to approximately 7.38 percent, indicating a slightly higher required return in the valuation model.
  • Revenue Growth has fallen modestly from about 6.04 percent to approximately 5.79 percent, incorporating more conservative top line assumptions.
  • Net Profit Margin has improved slightly from roughly 13.42 percent to about 13.51 percent, driven by higher long term margin expectations.
  • Future P/E has edged up from around 31.12 times to roughly 31.19 times, consistent with the small increase in fair value despite softer growth assumptions.

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