Waste Management.
B-R-R-R-R! Thud! B.. The noise of a truck wakes you up. You look out the window. It’s Waste Management. A leader in terms of the waste collector market in the US, but is it really a good buy? As a famous meme now says, this stock is trash. Let’s find out! (In my opinion not so much, but bear with me!) :)
Stock Information
Ok, so what does this company do? Apart from waking you up at the crack of dawn, they own landfills, help with hazardous waste ☢️, produce their own gas ⛽️ to produce electricity ⚡️ from landfills. What a great idea! Market share of the waste management market is as follows:
In Poland, where I live, I only see Veoila and Remondis products, but in the USA 🇺🇸, WM is the biggest. Also, they are in the Backrooms. 😱
Dividend growth at 7.27%, with a yield sitting at 1.44%, dividend growth for 20 years! 🎢
Essentially sharing an oligopoly with Republic Services, connected with their capital expensive business 💲, makes it hard to disrupt them, and they have long term contracts as well.📄
Revenue growth
We want to see a company grow their earnings, or if not, keep its monopolistic position all the time.
As would Mr Bean say:
Yeah guys, so I have a long position on WM, and no sign of them getting disrupted, I guess it’s a good bet!
Mr Bean
Financial Health
If a company was in a bad state of health, why would I buy it? Up to this point, we were calculationing a company’s financial health based on their Net Cash, however, that proves to be a little too harsh for even great companies, like Visa, so we’re introducing a version which will use net assets instead - at no extra cost to you. :)
Stock Dividends
Who doesn’t like getting dividends from stocks? No one, but we want the company to offer us high dividend growth as well, not only the highest yield, as most of the time these companies with the high yields are value traps 🪤 .
Valuation
Undervalued by 20%.
Conclusion
A really solid company, a great pick to any investor’s portfolio, but for me, I just don’t see the point of having even more companies, but nevertheless, if I were starting out, I would probably pick this one, as it’s in an industry that’s useful.
PS. I recently started a youtube channel with funny investing videos: https://youtube.com/@monopolisticinvestor?si=FFWIK4b8ZgjebNQW Check it out! 😀