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Waste Management Inc. (WM - Free Report) reported solid second-quarter 2022 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings per share (excluding 3 cents from non-recurring items) of $1.44 beat the Zacks Consensus Estimate by 5.9% and improved 13.4% year over year. Total revenues of $5.03 billion beat the consensus estimate by 3.8% and increased 12.3% year over year.
Over the past year, shares of Waste Management have gained 6.4% against a 30.7% decline of the industry it belongs to.
Image Source: Zacks Investment Research
Let’s check out the numbers in detail.
Quarterly Numbers in Detail
The Collection segment recorded revenues of $3.31 billion, up 14.1% from the prior-year quarter’s figure. The Landfill segment’s top line grew 10.2% year over year to $1.2 billion. Total revenues in the Transfer segment were up 4.1% to $554 million. Recycling segment revenues increased 17.8% to $468 million. Other businesses’ revenues totaled $596 million, up 16.2% year over year.
Adjusted operating EBITDA of $1.42 billion increased 8.4% from the year-ago quarter’s level. Adjusted operating EBITDA margin fell to 28.2% from 29.3% in the prior-year quarter.
Adjusted operating income came in at $907 million, up 12% from the year-ago quarter’s level. Adjusted operating income margin fell to 18.1% from 18.2% in the year-ago quarter.
Waste Management exited second-quarter 2022 with cash and cash equivalents of $894 million compared with $155 million at the end of the prior quarter. Long-term debt (less current portion) was $14 billion compared with $13.1 billion at the end of the prior quarter.
WM generated $1.05 billion of cash from operating activities in the reported quarter, while capital expenditures were $485 million. Free cash flow was $503 million.
During the reported quarter, Waste Management returned $539 million to its shareholders, including $269 million through cash dividends and $270 million through share repurchases.
WM’s revenue growth in 2022 is expected to be approximately 10%, up 400 basis points from the midpoint of the prior guided range.
Adjusted operating EBITDA is now expected between $5.5 billion and $5.6 billion in 2022.
Waste Management expects to complete acquisitions in the band of $300-$400 million in 2022.
The projected adjusted operating EBITDA margin of 28.1% matches the midpoint of its guided range.
Free cash flow is projected to exceed the upper end of WM’s previous guided range of $2.6-$2.7 billion, excluding the targeted sustainability growth investments, or $2.05-$2.15 billion, including the sustainability growth investments.
Waste Management expects to repurchase an additional $980 million of its common stock in 2022, exhausting the full $1.5 billion of share repurchase authorization, announced previously.
Recent Performances of Some Other Business Services Companies
Equifax (EFX - Free Report) reported mixed second-quarter 2022 results, wherein earnings beat estimates but revenues missed the same.
EFX’s adjusted earnings of $2.09 per share beat the Zacks Consensus Estimate by 3% and improved 5.6% on a year-over-year basis. Revenues of $1.32 billion missed the consensus estimate marginally but improved 6.6% year over year.
IQVIA Holdings (IQV - Free Report) reported solid second-quarter 2022 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
IQV’s adjusted earnings per share of $2.44 beat the consensus mark by 2.1% and improved 15% on a year-over-year basis. Total revenues of $3.54 billion outpaced the consensus estimate by 1.2% and increased 3% year over year.
Omnicom Group (OMC - Free Report) reported impressive second-quarter 2022 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
OMC’s earnings of $1.68 per share beat the consensus mark by 7.7% and increased 15.1% year over year, driven by a strong margin performance. Total revenues of $3.6 billion surpassed the consensus estimate by 4.4% but declined slightly year over year.
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Waste Management (WM) Q2 Earnings & Revenues Beat, Rise Y/Y
Waste Management Inc. (WM - Free Report) reported solid second-quarter 2022 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings per share (excluding 3 cents from non-recurring items) of $1.44 beat the Zacks Consensus Estimate by 5.9% and improved 13.4% year over year. Total revenues of $5.03 billion beat the consensus estimate by 3.8% and increased 12.3% year over year.
Over the past year, shares of Waste Management have gained 6.4% against a 30.7% decline of the industry it belongs to.
Image Source: Zacks Investment Research
Let’s check out the numbers in detail.
Quarterly Numbers in Detail
The Collection segment recorded revenues of $3.31 billion, up 14.1% from the prior-year quarter’s figure. The Landfill segment’s top line grew 10.2% year over year to $1.2 billion. Total revenues in the Transfer segment were up 4.1% to $554 million. Recycling segment revenues increased 17.8% to $468 million. Other businesses’ revenues totaled $596 million, up 16.2% year over year.
Adjusted operating EBITDA of $1.42 billion increased 8.4% from the year-ago quarter’s level. Adjusted operating EBITDA margin fell to 28.2% from 29.3% in the prior-year quarter.
Adjusted operating income came in at $907 million, up 12% from the year-ago quarter’s level. Adjusted operating income margin fell to 18.1% from 18.2% in the year-ago quarter.
Waste Management exited second-quarter 2022 with cash and cash equivalents of $894 million compared with $155 million at the end of the prior quarter. Long-term debt (less current portion) was $14 billion compared with $13.1 billion at the end of the prior quarter.
WM generated $1.05 billion of cash from operating activities in the reported quarter, while capital expenditures were $485 million. Free cash flow was $503 million.
During the reported quarter, Waste Management returned $539 million to its shareholders, including $269 million through cash dividends and $270 million through share repurchases.
Currently, Waste Management carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Waste Management, Inc. Price, Consensus and EPS Surprise
Waste Management, Inc. price-consensus-eps-surprise-chart | Waste Management, Inc. Quote
2022 Outlook
WM’s revenue growth in 2022 is expected to be approximately 10%, up 400 basis points from the midpoint of the prior guided range.
Adjusted operating EBITDA is now expected between $5.5 billion and $5.6 billion in 2022.
Waste Management expects to complete acquisitions in the band of $300-$400 million in 2022.
The projected adjusted operating EBITDA margin of 28.1% matches the midpoint of its guided range.
Free cash flow is projected to exceed the upper end of WM’s previous guided range of $2.6-$2.7 billion, excluding the targeted sustainability growth investments, or $2.05-$2.15 billion, including the sustainability growth investments.
Waste Management expects to repurchase an additional $980 million of its common stock in 2022, exhausting the full $1.5 billion of share repurchase authorization, announced previously.
Recent Performances of Some Other Business Services Companies
Equifax (EFX - Free Report) reported mixed second-quarter 2022 results, wherein earnings beat estimates but revenues missed the same.
EFX’s adjusted earnings of $2.09 per share beat the Zacks Consensus Estimate by 3% and improved 5.6% on a year-over-year basis. Revenues of $1.32 billion missed the consensus estimate marginally but improved 6.6% year over year.
IQVIA Holdings (IQV - Free Report) reported solid second-quarter 2022 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
IQV’s adjusted earnings per share of $2.44 beat the consensus mark by 2.1% and improved 15% on a year-over-year basis. Total revenues of $3.54 billion outpaced the consensus estimate by 1.2% and increased 3% year over year.
Omnicom Group (OMC - Free Report) reported impressive second-quarter 2022 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
OMC’s earnings of $1.68 per share beat the consensus mark by 7.7% and increased 15.1% year over year, driven by a strong margin performance. Total revenues of $3.6 billion surpassed the consensus estimate by 4.4% but declined slightly year over year.