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Waste Management: Great Business, Great Outlook And A Waste Valuation

Apr. 04, 2021 9:40 PM ETWaste Management, Inc. (WM)RSG, WCN, WCN:CA15 Comments
ZinsesZins profile picture


  • Waste Management owns an extremely solid business model.
  • There is strong evidence that more waste is being produced during the pandemic.
  • Waste production in the US shows a clear upward trend since the 1960s.
  • Only 32.1% of municipal solid waste was recycled or composted in 2018, offering a lot of potential for the future.

Gebrauchte medizinische Masken und Handschuhe auf dem Boden
Photo by Ladanifer/iStock via Getty Images

Investment thesis

Waste Management (NYSE:WM) owns an extremely solid business model. There is strong evidence that more waste is produced during the pandemic. The developed world is exporting a lot of plastic waste to

This article was written by

ZinsesZins profile picture
I am a long term investor focusing on solid business models. My main interests are common stocks and precious metals. 'ZinsesZins' is German for compound interest and as Albert Einstein said, it's the most powerful force in the universe.

Analyst’s Disclosure: I am/we are long WM. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (15)

09 Apr. 2021
Bought about 11/12 years ago at $36 a share. and as a Buy and Hold investor am loving it : )
Vikdan profile picture
Great company. Have held WM for 2 yrs roughly. Am expanding my "waste portfolio" with 2 established European names this month and a more risky Australian one. Think there is huge potential in this sector.

Thanks for writing.
08 Apr. 2021
@Vikdan What established European names are you looking at? And what Australian one?
Vikdan profile picture
@Izet Sorry for the late reply. I haven't decided specifically on the Australian one. Just bought Umicore and Veolia as my European names.
05 Apr. 2021
Why HOLD? Recommend SELL if you are confident in your calculations. Total Stock Market Cap to GDP hit 156% today everything looks overvalued.
ZinsesZins profile picture
@Amyn companies like WM are a long-term investment. Overvaluation is not reason to sell for me. I agree, the market is expensive. However, there are still some sectors with reasonable valuation (e.g. defense).
ferjen profile picture
Definitely overvalued:

ZinsesZins, Interesting study you presented. Thanks for sharing it.
I see your point, but my basis is $35!!! Would love to own more but since my original purchase, it has always seemed too expensive. Might write some covered calls, but don’t want to get taken out!
ZinsesZins profile picture
@spanish moss congratulations to $35. I don't see any reason to sell WM (or start gambling), it's just too expensive to add more right now.
I agree with your analysis. It is a great company to hold, but looks a bit too expensive to be adding to at the moment. I also am waiting for a pullback to add more. My target for buying would be if and when the PE comes back to its historical average.
Demand for their service can only increase, regardless of what the market does. I will keep my shares forever.
ZinsesZins profile picture
@RushBabe49 that‘s what I plan to do as well.
Interesting. Don’t see it pulling back 30+% without a full market correction. If it does go below 100 will happily add to my position created at 80... but think there are better opportunities with a market correction...
ZinsesZins profile picture
@longterm-invest I agree, -30% is probably too much and $100 sounds like a good plan.
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