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Adjusted earnings (excluding 17 cents from non-recurring items) per share of $1.09 beat the Zacks Consensus Estimate by 5.8% but fell 8.4% year over year. Total revenues of $3.86 billion beat the consensus estimate by 3.5% but declined 2.7% year over year.
In the reported quarter, revenues declined $99 million in the company’s collection and disposal business due to $192 million worth of volume declines, which were partially offset by $93 million of yield growth.
So far this year, shares of Waste Management have lost 0.6% compared with 18.9% decline of the industry it belongs to.
Quarterly Numbers in Detail
The Collection segment recorded revenues of $2.5 billion, down 4.2% from the prior-year quarter’s figure. Landfill segment’s top line declined 4.7% year over year to $946 million. Total revenues in the Transfer segment were up 2.3% to $482 million. Recycling segment revenues improved 18.4% to $290 million. Other businesses’ revenues totaled $458 million, down 2.3% year over year.
Adjusted operating EBITDA of $1.14 billion declined marginally from the year-ago quarter’s level. Adjusted operating EBITDA margin rose to 29.5% from 28.8% in the prior-year quarter.
Operating income came in at $680 million compared with $734 million in the year-ago quarter. Operating income margin declined to 17.6% from 18.5% in the year-ago quarter.
Waste Management exited third-quarter 2020 with cash and cash equivalents of $703 million compared with $2.6 billion at the end of the prior quarter. Long-term debt (minus current portion) was $10.25 billion compared with $9.59 billion at the end of the prior quarter.
The company generated $1.03 billion of cash from operating activities and capital expenditures were $343 million. Free cash flow was $691 million. The company paid out dividends worth $230 million.
2020 Guidance
Waste Management expects adjusted operating EBITDA margin is anticipated in the range of 28-28.5% (unchanged from previous guidance). Free cash flow is estimated in excess of $2 billion.
Waste Management, Inc. Price, Consensus and EPS Surprise
Equifax (EFX - Free Report) reported better-than-expected third-quarter 2020 results, with adjusted earnings of $1.87 per share beating the Zacks Consensus Estimate by 16.2% and rising 26.4% on a year-over-year basis. The reported figure exceeded the guidance of $1.30-$1.40.
The Interpublic Group of Companies (IPG - Free Report) reported better-than-expected third-quarter 2020 adjusted earnings of 53 cents per share, which beat the Zacks Consensus Estimate by 43.2% and rose 8.2% on a year-over-year basis.
IQVIA Holdings (IQV - Free Report) reported solid third-quarter 2020 adjusted earnings per share of $1.63, which beat the consensus mark by 8% and inched up 1.9% on a year-over-year basis. The reported figure was above the guidance of $1.47-$1.55.
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Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Waste Management (WM) Beats Q3 Earnings & Revenue Estimates
Waste Management Inc. (WM - Free Report) reported better-than-expected third-quarter 2020 results.
Adjusted earnings (excluding 17 cents from non-recurring items) per share of $1.09 beat the Zacks Consensus Estimate by 5.8% but fell 8.4% year over year. Total revenues of $3.86 billion beat the consensus estimate by 3.5% but declined 2.7% year over year.
In the reported quarter, revenues declined $99 million in the company’s collection and disposal business due to $192 million worth of volume declines, which were partially offset by $93 million of yield growth.
So far this year, shares of Waste Management have lost 0.6% compared with 18.9% decline of the industry it belongs to.
Quarterly Numbers in Detail
The Collection segment recorded revenues of $2.5 billion, down 4.2% from the prior-year quarter’s figure. Landfill segment’s top line declined 4.7% year over year to $946 million. Total revenues in the Transfer segment were up 2.3% to $482 million. Recycling segment revenues improved 18.4% to $290 million. Other businesses’ revenues totaled $458 million, down 2.3% year over year.
Adjusted operating EBITDA of $1.14 billion declined marginally from the year-ago quarter’s level. Adjusted operating EBITDA margin rose to 29.5% from 28.8% in the prior-year quarter.
Operating income came in at $680 million compared with $734 million in the year-ago quarter. Operating income margin declined to 17.6% from 18.5% in the year-ago quarter.
Waste Management exited third-quarter 2020 with cash and cash equivalents of $703 million compared with $2.6 billion at the end of the prior quarter. Long-term debt (minus current portion) was $10.25 billion compared with $9.59 billion at the end of the prior quarter.
The company generated $1.03 billion of cash from operating activities and capital expenditures were $343 million. Free cash flow was $691 million. The company paid out dividends worth $230 million.
2020 Guidance
Waste Management expects adjusted operating EBITDA margin is anticipated in the range of 28-28.5% (unchanged from previous guidance). Free cash flow is estimated in excess of $2 billion.
Waste Management, Inc. Price, Consensus and EPS Surprise
Waste Management, Inc. price-consensus-eps-surprise-chart | Waste Management, Inc. Quote
Currently, Waste Management carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Business Services Companies
Equifax (EFX - Free Report) reported better-than-expected third-quarter 2020 results, with adjusted earnings of $1.87 per share beating the Zacks Consensus Estimate by 16.2% and rising 26.4% on a year-over-year basis. The reported figure exceeded the guidance of $1.30-$1.40.
The Interpublic Group of Companies (IPG - Free Report) reported better-than-expected third-quarter 2020 adjusted earnings of 53 cents per share, which beat the Zacks Consensus Estimate by 43.2% and rose 8.2% on a year-over-year basis.
IQVIA Holdings (IQV - Free Report) reported solid third-quarter 2020 adjusted earnings per share of $1.63, which beat the consensus mark by 8% and inched up 1.9% on a year-over-year basis. The reported figure was above the guidance of $1.47-$1.55.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>