Earnings season is in full swing, with huge numbers of companies having already given their latest numbers to investors, and Waste Connections (NYSE:WCN) is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Hauling garbage may not seem like the best way to make money, but Waste Connections has found its niche in what has become a huge moneymaking industry. Let's take an early look at what's been happening with Waste Connections over the past quarter and what we're likely to see in its quarterly report on Wednesday.

Stats on Waste Connections

Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$445 million

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance.

Will Waste Connections cash in on the trash this quarter?
Over the past few months, analysts have raised their earnings-per-share estimates by $0.02 for the just-ended quarter and $0.06 for full-year 2013. Investors have picked up on those moves, pushing the stock's price up more than 17% since mid-November.

In an industry dominated by much larger players Waste Management (NYSE:WM) and Republic Services (NYSE:RSG), Waste Connections has had to take a somewhat different path to success. By avoiding highly competitive major metropolitan areas in favor of smaller cities and towns, Waste Connections has managed to grow to become the third-largest operator in the U.S., feeding growth with strategic acquisitions aimed at those second-tier markets.

Unfortunately, Waste Connections has largely missed out on a big trend in trash: alternative energy. With Covanta (NYSE:CVA) leading the industry in waste-to-renewable operations, Waste Management and Republic have both ramped up their projects to collect and use landfill gas as well as producing energy through trash incineration. By contrast, Waste Connections has minimal exposure to the space, which may be one reason its dividend yield lags behind its peers' payouts.

In Waste Connections' quarterly report, look for signs of how the company's acquisition of R360 Environmental Solutions has affected its business. With the deal having closed in October, R360 gives Waste Connections exposure to the waste-disposal market from oil and gas exploration and production. That's a potentially huge growth industry, especially with all the activity at new shale energy plays, and could be the catalyst that pushes Waste Connections into the spotlight in the year ahead.

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