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Waste Management Ups Dividend, To Buyback $750M Shares
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Waste Management, Inc. (WM - Free Report) recently announced a 3.7% year-over-year hike in its quarterly dividend payout to 42.5 cents per share. This brings the annualized dividend payout to $1.70 per share from first-quarter 2017. The first lot of the increased dividend is likely to be paid in March.
A steady dividend payment policy is part of Waste Management’s long-term strategy of providing attractive risk-adjusted returns to its stockholders. The company’s investment strategy takes a holistic view of the rapidly evolving market and deploys a dynamic capital allocation approach to execute its growth strategy. In addition, decent dividend increases at periodic intervals have been one of the company’s most attractive features. The current dividend hike marks the 14th consecutive year in quarterly dividend increase.
At the same time, the company authorized a new share repurchase program worth $750 million. The new share repurchase program replaces the erstwhile program, under which Waste Management repurchased $575 million worth of shares.
Waste Management remains confident that it would generate adequate free cash flow to fund its increased dividend and share repurchase program in the future. The company intends to return $1.4 billion to shareholders in 2016 through dividend and share repurchases.
Waste Management outperformed the Zacks categorized Waste Removal Services industry with an average return of 11.6% in the last three months compared with 3.3% for the latter. The company has taken steps to divest non-core operations and enhance focus on potential high-growth areas that will generate higher cash flows and boost the top line. In addition, Waste Management’s successful cost-reduction initiatives have helped it accomplish remarkable gross margin expansion and EBITDA (earnings before interest, tax, depreciation and amortization) growth over the quarters.
Headquartered in Houston, TX, Waste Management is the largest provider of comprehensive waste management services in North America. The company provides collection, transfer, recycling and resource recovery, as well as disposal services to residential, commercial, industrial and municipal customers. It is also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the U.S.
CRA International has a long-term earnings growth expectation of 8% and has beaten estimates thrice in the trailing four quarters with an average negative earnings surprise of 3%.
Gartner has long-term earnings growth expectation of 17.3% and has beaten estimates in each of the trailing four quarters for an average positive earnings surprise of 14.5%.
Hackett has long-term earnings growth expectation of 17.3% and has missed estimates twice in the trailing four quarters for an average negative earnings surprise of 5.1%.
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Waste Management Ups Dividend, To Buyback $750M Shares
Waste Management, Inc. (WM - Free Report) recently announced a 3.7% year-over-year hike in its quarterly dividend payout to 42.5 cents per share. This brings the annualized dividend payout to $1.70 per share from first-quarter 2017. The first lot of the increased dividend is likely to be paid in March.
A steady dividend payment policy is part of Waste Management’s long-term strategy of providing attractive risk-adjusted returns to its stockholders. The company’s investment strategy takes a holistic view of the rapidly evolving market and deploys a dynamic capital allocation approach to execute its growth strategy. In addition, decent dividend increases at periodic intervals have been one of the company’s most attractive features. The current dividend hike marks the 14th consecutive year in quarterly dividend increase.
At the same time, the company authorized a new share repurchase program worth $750 million. The new share repurchase program replaces the erstwhile program, under which Waste Management repurchased $575 million worth of shares.
Waste Management remains confident that it would generate adequate free cash flow to fund its increased dividend and share repurchase program in the future. The company intends to return $1.4 billion to shareholders in 2016 through dividend and share repurchases.
Waste Management outperformed the Zacks categorized Waste Removal Services industry with an average return of 11.6% in the last three months compared with 3.3% for the latter. The company has taken steps to divest non-core operations and enhance focus on potential high-growth areas that will generate higher cash flows and boost the top line. In addition, Waste Management’s successful cost-reduction initiatives have helped it accomplish remarkable gross margin expansion and EBITDA (earnings before interest, tax, depreciation and amortization) growth over the quarters.
Headquartered in Houston, TX, Waste Management is the largest provider of comprehensive waste management services in North America. The company provides collection, transfer, recycling and resource recovery, as well as disposal services to residential, commercial, industrial and municipal customers. It is also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the U.S.
Waste Management currently has a Zacks Rank #2 (Buy). Other favorably ranked stocks in the industry include CRA International, Inc. (CRAI - Free Report) , Gartner, Inc. (IT - Free Report) and The Hackett Group, Inc. (HCKT - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
CRA International has a long-term earnings growth expectation of 8% and has beaten estimates thrice in the trailing four quarters with an average negative earnings surprise of 3%.
Gartner has long-term earnings growth expectation of 17.3% and has beaten estimates in each of the trailing four quarters for an average positive earnings surprise of 14.5%.
Hackett has long-term earnings growth expectation of 17.3% and has missed estimates twice in the trailing four quarters for an average negative earnings surprise of 5.1%.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>