Waste Connections, Inc.
Waste Connections, Inc. Fundamental Analysis
Waste Connections, Inc. (WCN) shows moderate financial fundamentals with a PE ratio of 38.04, profit margin of 10.97%, and ROE of 12.93%. The company generates $9.6B in annual revenue with moderate year-over-year growth of 6.55%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 46.1/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze WCN's fundamental strength across five key dimensions:
Efficiency Score
WeakWCN struggles to generate sufficient returns from assets.
Valuation Score
ModerateWCN shows balanced valuation metrics.
Growth Score
ExcellentWCN delivers strong and consistent growth momentum.
Financial Health Score
WeakWCN carries high financial risk with limited liquidity.
Profitability Score
WeakWCN struggles to sustain strong margins.
Key Financial Metrics
Is WCN Expensive or Cheap?
P/E Ratio
WCN trades at 38.04 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, WCN's PEG of 0.55 indicates potential undervaluation.
Price to Book
The market values Waste Connections, Inc. at 5.00 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 11.13 times EBITDA. This signals the market has high growth expectations.
How Well Does WCN Make Money?
Net Profit Margin
For every $100 in sales, Waste Connections, Inc. keeps $10.97 as profit after all expenses.
Operating Margin
Core operations generate 17.59 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $12.93 in profit for every $100 of shareholder equity.
ROA
Waste Connections, Inc. generates $5.00 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Waste Connections, Inc. generates strong operating cash flow of $2.41B, reflecting robust business health.
Free Cash Flow
Waste Connections, Inc. generates strong free cash flow of $1.13B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $4.46 in free cash annually.
FCF Yield
WCN converts 2.84% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
38.04
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.55
vs 25 benchmark
P/B Ratio
Price to book value ratio
5.00
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.15
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.17
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.69
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.13
vs 25 benchmark
ROA
Return on assets percentage
0.05
vs 25 benchmark
ROCE
Return on capital employed
0.09
vs 25 benchmark
How WCN Stacks Against Its Sector Peers
| Metric | WCN Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 38.04 | 26.32 | Worse (Expensive) |
| ROE | 12.93% | 1286.00% | Weak |
| Net Margin | 10.97% | -41798.00% (disorted) | Strong |
| Debt/Equity | 1.17 | 0.72 | Weak (High Leverage) |
| Current Ratio | 0.69 | 10.61 | Weak Liquidity |
| ROA | 5.00% | -1507802.00% (disorted) | Weak |
WCN outperforms its industry in 1 out of 6 key metrics, particularly excelling in Net Margin, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Waste Connections, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
79.54%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
443.16%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
79.43%
Industry Style: Cyclical, Value, Infrastructure
High Growth