William Blair analyst Trevor Romeo has reiterated their bullish stance on WM stock, giving a Buy rating on June 23.
Confident Investing Starts Here:
- Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions
- Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter
Trevor Romeo has given his Buy rating due to a combination of factors including Waste Management’s diverse growth drivers and robust financial outlook. The company’s investor day highlighted its industry-leading asset network and projected an impressive adjusted EBITDA compound annual growth rate of 11% through 2027. Although there were limited new details on sustainability ventures, the incremental information on WM Healthcare Solutions is expected to boost investor confidence, particularly in relation to growth and cross-selling opportunities from the Stericycle acquisition.
Overall, Waste Management is on track to achieve over $4 billion, or $10 per share, in free cash flow by 2027, suggesting a potential stock price increase of over 20% to $280-$285 per share within the next 12-18 months. This is based on a price-to-free cash flow multiple that remains below the average of its peers. The shares are currently trading at a discount compared to other solid waste companies, presenting a favorable entry point for investors. Additionally, sustainability investments and the successful integration of Stericycle are seen as further catalysts for medium-term growth, despite risks like commodity price volatility and labor shortages.
In another report released on June 23, Truist Financial also maintained a Buy rating on the stock with a $250.00 price target.
Based on the recent corporate insider activity of 100 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of WM in relation to earlier this year.