David Zanoni
Momentum, growth at reasonable price, long-term horizon
Momentum at a Reasonable PriceSummary
Conditions in the industry are positive for Waste Management.
Waste Management’s high effective tax rate could be lowered with new legislation.
There is still plenty of upside for the stock based on continued earnings growth.
Look in your own trash can and you can find potential treasure. I’m not talking about making art out of banana peels and egg shells. I am referring to the investment potential for the waste management industry. There is an ongoing need to collect and haul trash from commercial, industrial, and residential areas. One company that stands out in this space is Waste Management (WM).
Waste Management is the leading provider of waste management environmental services in North America. I think the company and the stock is poised to perform well in 2017 and 2018 due to positive conditions in the industry, a potential tax benefit, and a reasonable valuation.
Image source: hurriyetdailynews.com Message: added by author using memedad.com
Positive Industry Conditions
The U.S. Consumer Price Index [CPI] increased 2.2% over the past 12 months ending in April. The strength in consumer prices supports rising prices for Waste Management’s hauling services. The reason for this is because the rise in CPI will help Waste Management’s CPI-linked price contracts for 2017.
The rise in service prices is expected to outweigh higher costs. As a result, Waste Management’s margins are expected to rise. The increase in revenue is expected to outweigh higher fuel prices, leading to increased EBITDA margins. Therefore, earnings and cash flow for the companies in the industry are expected to increase.
Volume growth in the industry is expected to be sustained in 2017. Industry volume growth is expected to be 1% to 2%. Waste Management is expected to achieve volume growth in the middle of this range.
www.fotavgeia.blogspot.com
Momentum, growth at reasonable price, long-term horizon
Momentum at a Reasonable PriceSummary
Conditions in the industry are positive for Waste Management.
Waste Management’s high effective tax rate could be lowered with new legislation.
There is still plenty of upside for the stock based on continued earnings growth.
Look in your own trash can and you can find potential treasure. I’m not talking about making art out of banana peels and egg shells. I am referring to the investment potential for the waste management industry. There is an ongoing need to collect and haul trash from commercial, industrial, and residential areas. One company that stands out in this space is Waste Management (WM).
Waste Management is the leading provider of waste management environmental services in North America. I think the company and the stock is poised to perform well in 2017 and 2018 due to positive conditions in the industry, a potential tax benefit, and a reasonable valuation.
Image source: hurriyetdailynews.com Message: added by author using memedad.com
Positive Industry Conditions
The U.S. Consumer Price Index [CPI] increased 2.2% over the past 12 months ending in April. The strength in consumer prices supports rising prices for Waste Management’s hauling services. The reason for this is because the rise in CPI will help Waste Management’s CPI-linked price contracts for 2017.
The rise in service prices is expected to outweigh higher costs. As a result, Waste Management’s margins are expected to rise. The increase in revenue is expected to outweigh higher fuel prices, leading to increased EBITDA margins. Therefore, earnings and cash flow for the companies in the industry are expected to increase.
Volume growth in the industry is expected to be sustained in 2017. Industry volume growth is expected to be 1% to 2%. Waste Management is expected to achieve volume growth in the middle of this range.
www.fotavgeia.blogspot.com
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