Waste Connections, Inc. (NYSE:WCN) Just Released Its Third-Quarter Earnings: Here's What Analysts Think

Shareholders might have noticed that Waste Connections, Inc. (NYSE:WCN) filed its quarterly result this time last week. The early response was not positive, with shares down 3.2% to US$176 in the past week. Waste Connections reported US$2.3b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$1.19 beat expectations, being 2.0% higher than what the analysts expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Waste Connections

Taking into account the latest results, the most recent consensus for Waste Connections from 22 analysts is for revenues of US$9.57b in 2025. If met, it would imply a decent 10% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 31% to US$4.78. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$9.54b and earnings per share (EPS) of US$4.85 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$194. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Waste Connections at US$225 per share, while the most bearish prices it at US$135. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Waste Connections' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 8.0% growth on an annualised basis. This is compared to a historical growth rate of 11% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.6% annually. So it's pretty clear that, while Waste Connections' revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Waste Connections going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Waste Connections that you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.