The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Waste Management met expectations on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share dropped significantly.
Gross margins contracted, operating margins grew, net margins contracted.
Waste Management reported revenue of $3.46 billion. The eight analysts polled by S&P Capital IQ foresaw a top line of $3.50 billion on the same basis. GAAP reported sales were 1.7% lower than the prior-year quarter's $3.52 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.61. The 11 earnings estimates compiled by S&P Capital IQ predicted $0.60 per share. GAAP EPS of $0.46 for Q3 were 21% lower than the prior-year quarter's $0.58 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 35.6%, 20 basis points worse than the prior-year quarter. Operating margin was 16.4%, 40 basis points better than the prior-year quarter. Net margin was 6.2%, 150 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $3.41 billion. On the bottom line, the average EPS estimate is $0.61.
Next year's average estimate for revenue is $13.70 billion. The average EPS estimate is $2.11.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 2,616 members out of 2,673 rating the stock outperform, and 57 members rating it underperform. Among 641 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 628 give Waste Management a green thumbs-up, and 13 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Waste Management is hold, with an average price target of $33.14.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Waste Management. Motley Fool newsletter services recommend Waste Management. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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