NYSE:WCN

Stock Analysis Report

Executive Summary

Waste Connections, Inc. provides waste collection, transfer, disposal, and recycling services in the United States and Canada.

Rewards

Trading at 10.1% below its fair value

Earnings are forecast to grow 15.69% per year

Risk Analysis

Has a high level of debt



Snowflake Analysis

Adequate balance sheet with questionable track record.


Similar Companies

Share Price & News

How has Waste Connections's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WCN has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.5%

WCN

-1.3%

US Commercial Services

-1.2%

US Market


1 Year Return

18.1%

WCN

20.4%

US Commercial Services

15.5%

US Market

Return vs Industry: WCN underperformed the US Commercial Services industry which returned 20.4% over the past year.

Return vs Market: WCN exceeded the US Market which returned 15.5% over the past year.


Shareholder returns

WCNIndustryMarket
7 Day-0.5%-1.3%-1.2%
30 Day0.6%0.8%1.4%
90 Day-1.2%2.5%4.7%
1 Year19.0%18.1%24.6%20.4%18.0%15.5%
3 Year76.2%72.2%55.3%45.2%44.8%35.4%
5 Yearn/a100.9%80.5%67.3%48.9%

Price Volatility Vs. Market

How volatile is Waste Connections's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Waste Connections undervalued compared to its fair value and its price relative to the market?

10.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WCN ($90.81) is trading below our estimate of fair value ($100.99)

Significantly Below Fair Value: WCN is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: WCN is poor value based on its PE Ratio (42.3x) compared to the Commercial Services industry average (26.4x).

PE vs Market: WCN is poor value based on its PE Ratio (42.3x) compared to the US market (18.3x).


Price to Earnings Growth Ratio

PEG Ratio: WCN is poor value based on its PEG Ratio (2.7x)


Price to Book Ratio

PB vs Industry: WCN is overvalued based on its PB Ratio (3.5x) compared to the US Commercial Services industry average (2x).


Next Steps

Future Growth

How is Waste Connections forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

15.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WCN's forecast earnings growth (15.7% per year) is above the savings rate (1.7%).

Earnings vs Market: WCN's earnings (15.7% per year) are forecast to grow faster than the US market (14.2% per year).

High Growth Earnings: WCN's earnings are forecast to grow, but not significantly.

Revenue vs Market: WCN's revenue (6.6% per year) is forecast to grow slower than the US market (7.4% per year).

High Growth Revenue: WCN's revenue (6.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WCN's Return on Equity is forecast to be low in 3 years time (13.9%).


Next Steps

Past Performance

How has Waste Connections performed over the past 5 years?

36.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WCN has high quality earnings.

Growing Profit Margin: WCN's current net profit margins (10.7%) are lower than last year (15.1%).


Past Earnings Growth Analysis

Earnings Trend: WCN's earnings have grown significantly by 36.8% per year over the past 5 years.

Accelerating Growth: WCN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: WCN had negative earnings growth (-22.4%) over the past year, making it difficult to compare to the Commercial Services industry average (-3.1%).


Return on Equity

High ROE: WCN's Return on Equity (8.3%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Waste Connections's financial position?


Financial Position Analysis

Short Term Liabilities: WCN's short term assets ($1.1B) exceed its short term liabilities ($991.8M).

Long Term Liabilities: WCN's short term assets ($1.1B) do not cover its long term liabilities ($5.5B).


Debt to Equity History and Analysis

Debt Level: WCN's debt to equity ratio (60.6%) is considered high.

Reducing Debt: WCN's debt to equity ratio has reduced from 87% to 60.6% over the past 5 years.

Debt Coverage: WCN's debt is well covered by operating cash flow (37.9%).

Interest Coverage: WCN's interest payments on its debt are well covered by EBIT (6.6x coverage).


Balance Sheet

Inventory Level: WCN has a high level of physical assets or inventory.

Debt Coverage by Assets: WCN's debt is not covered by short term assets (assets are 0.3x debt).


Next Steps

Dividend

What is Waste Connections's current dividend yield, its reliability and sustainability?

0.81%

Current Dividend Yield


Dividend Yield vs Market

company0.8%marketbottom25%1.4%markettop25%3.7%industryaverage1.6%forecastin3Years0.8%

Current dividend yield vs market & industry

Notable Dividend: WCN's dividend (0.81%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: WCN's dividend (0.81%) is low compared to the top 25% of dividend payers in the US market (3.71%).


Stability and Growth of Payments

Stable Dividend: WCN is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: WCN is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: WCN is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of WCN's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Waste Connections's salary, the management and board of directors tenure and is there insider trading?

10.3yrs

Average management tenure


CEO

Worthing Jackman (55yo)

0.8yrs

Tenure

US$2,366,374

Compensation

Mr. Worthing F. Jackman has served as a Chief Executive Officer and has been President at Waste Connections, Inc. since July 01, 2018. He serves as a Director at Waste Connections, Inc. since July 25, 2019 ...


CEO Compensation Analysis

Compensation vs Market: Worthing's total compensation ($USD2.37M) is below average for companies of similar size in the US market ($USD11.01M).

Compensation vs Earnings: Worthing's compensation has been consistent with company performance over the past year.


Management Age and Tenure

10.3yrs

Average Tenure

55yo

Average Age

Experienced Management: WCN's management team is seasoned and experienced (10.3 years average tenure).


Board Age and Tenure

9.2yrs

Average Tenure

63yo

Average Age

Experienced Board: WCN's board of directors are considered experienced (9.2 years average tenure).


Insider Trading

Insider Buying: WCN insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$84,57422 Nov 19
David Eddie
EntityIndividual
Role
Chief Accounting Officer
Chief Accounting Officer & Senior VP
Shares934
Max PriceUS$90.55
SellUS$186,33010 Sep 19
Michael Harlan
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,038
Max PriceUS$91.43
SellUS$366,76106 Sep 19
Matthew Black
EntityIndividual
Shares4,000
Max PriceUS$91.69
SellUS$1,808,25019 Aug 19
Edward Guillet
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares20,000
Max PriceUS$90.41
SellUS$1,570,02912 Aug 19
Patrick Shea
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares17,000
Max PriceUS$92.36
SellUS$495,00008 Aug 19
Eric Hansen
EntityIndividual
Role
Chief Information Officer
Senior VP & Chief Information Officer
Shares5,500
Max PriceUS$90.00
SellUS$897,43206 Aug 19
James Little
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Engineering & Disposal
Shares10,000
Max PriceUS$89.74
SellUS$1,262,71706 Aug 19
Darrell Chambliss
EntityIndividual
Role
Chief Operating Officer
COO & Executive VP
Shares14,100
Max PriceUS$90.01
SellUS$541,72005 Aug 19
William Razzouk
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares6,000
Max PriceUS$90.29

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Ron Mittelstaedt (56yo)

    Executive Chairman

    • Tenure: 21.9yrs
    • Compensation: US$13.69m
  • Darrell Chambliss (55yo)

    COO & Executive VP

    • Tenure: 16.2yrs
    • Compensation: US$1.92m
  • James Little (57yo)

    Senior Vice President of Engineering & Disposal

    • Tenure: 10.8yrs
    • Compensation: US$1.17m
  • David Hall (61yo)

    Senior Vice President of Sales & Marketing

    • Tenure: 14.2yrs
  • Eric Hansen (54yo)

    Senior VP & Chief Information Officer

    • Tenure: 15.4yrs
  • David Eddie (49yo)

    Chief Accounting Officer & Senior VP

    • Tenure: 9.8yrs
    • Compensation: US$1.23m
  • Worthing Jackman (55yo)

    President

    • Tenure: 0.8yrs
    • Compensation: US$2.37m
  • Patrick Shea (48yo)

    Executive VP

    • Tenure: 10.8yrs
    • Compensation: US$1.35m
  • Mary Whitney (55yo)

    Senior VP & CFO

    • Tenure: 1.4yrs
    • Compensation: US$1.09m
  • Susan Netherton (49yo)

    Vice President of People

    • Tenure: 6.4yrs

Board Members

  • Bill Razzouk (71yo)

    Independent Director

    • Tenure: 21.9yrs
    • Compensation: US$307.47k
  • Sue Lee (67yo)

    Independent Director

    • Tenure: 5.6yrs
    • Compensation: US$277.34k
  • Ron Mittelstaedt (56yo)

    Executive Chairman

    • Tenure: 21.9yrs
    • Compensation: US$13.69m
  • Michael Harlan (58yo)

    Independent Director

    • Tenure: 21.6yrs
    • Compensation: US$298.80k
  • Ned Guillet (67yo)

    Independent Director

    • Tenure: 12.8yrs
    • Compensation: US$301.21k
  • Worthing Jackman (55yo)

    President

    • Tenure: 0.8yrs
    • Compensation: US$2.37m
  • Larry Hughes (67yo)

    Independent Director

    • Tenure: 5.6yrs
    • Compensation: US$275.65k
  • Elise Jordan (59yo)

    Director

    • Tenure: 0.3yrs

Company Information

Waste Connections, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Waste Connections, Inc.
  • Ticker: WCN
  • Exchange: NYSE
  • Founded: 1997
  • Industry: Environmental and Facilities Services
  • Sector: Commercial Services
  • Market Cap: US$23.699b
  • Shares outstanding: 263.68m
  • Website: https://www.wasteconnections.com

Number of Employees


Location

  • Waste Connections, Inc.
  • 3 Waterway Square Place
  • Suite 110
  • The Woodlands
  • Texas
  • 77380
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WCNNYSE (New York Stock Exchange)YesNew Common StockUSUSDJun 2016
WCNTSX (The Toronto Stock Exchange)YesNew Common StockCACADJun 2016
UI51DB (Deutsche Boerse AG)YesNew Common StockDEEURJun 2016

Biography

Waste Connections, Inc. provides waste collection, transfer, disposal, and recycling services in the United States and Canada. The company operates through six segments: Southern, Western, Eastern, Canada, ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/06 00:43
End of Day Share Price2019/12/05 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.