Hauling trash away is Waste Management's (NYSE: WMI ) specialty, so it's no surprise the company has kept its financials clean during the economic turmoil. While the adage that Waste Management's industry is resilient to unfavorable economic times has been questioned at times, its third-quarter earnings were kept tidy.
The company earned $310 million, or $0.63 a share, versus $278 million, or $0.54 a share, for the same quarter a year ago, while expectations were set for only $0.62. The company achieved an income increase of 11.4% after special items -- despite higher diesel fuel costs -- on revenues that, at $3.53 billion, were 3.6% higher than a year ago.
Of Waste Management's lines of business, Collection Services, which constitutes about 63% of the total, was up just 1% year over year. In fact, most of the company's lines checked in with results that were flattish with year-ago numbers.
The most noteworthy event during the quarter involved the company's attempted intervention in a merger agreement that had been carved out between Allied Waste (NYSE: AW ) , the second-largest player in the industry, and Republic Services (NYSE: RSG ) , the third-largest waste hauler. But earlier this month, Waste Management withdrew its $6.74 billion bid to acquire Republic, pointing to the state of the financial markets for its decision.
At some point in this quarter, Allied and Republic will merge. The resulting company will be about two-thirds the size of Waste Management from a revenue perspective. The other publicly held members of the group, California's Waste Connections (NYSE: WCN ) and Casella Waste (Nasdaq: CWST ) , are both considerably smaller than their bigger brethren.
Waste Management's shares closed Thursday about 20% below their 52-week high and more than 6% above their Wednesday finish. From my perspective, the company's solid results in the latest quarter, coupled with it 3.7% forward dividend yield, make it worth watching amid the current loop-de-loop volatility of the equities markets.
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