What Happened?
Shares of waste management services provider Waste Management (NYSE: WM) fell 3.8% in the morning session after the company reported third-quarter results that missed Wall Street's expectations for both revenue and earnings per share.
The waste services provider posted quarterly revenue of $6.44 billion, a 14.9% year-on-year increase but still short of the $6.51 billion analysts had anticipated. Similarly, its adjusted profit of $1.98 per share was slightly below the consensus estimate of $2.01. The company's profitability also came under pressure, with its operating margin declining to 15.3% from 20% in the same quarter last year. This was attributed to operating expenses growing faster than revenue, overshadowing the strong sales growth and a higher gross margin.
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What Is The Market Telling Us
Waste Management’s shares are not very volatile and have only had 2 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 3 months ago when the stock gained 3.3% on the news that the company reported strong second-quarter results that surpassed analyst expectations for both revenue and profit. The company posted revenue of $6.43 billion, marking a 19% increase year-over-year, alongside an adjusted earnings per share of $1.92. This growth was largely fueled by the acquisition of Stericycle, which contributed significantly to the positive results. In addition to beating on the top and bottom lines, Waste Management achieved a record operating expense margin, highlighting operational efficiency. The company also boosted investor confidence by raising its full-year free cash flow guidance by $125 million, projecting a range between $2.8 billion and $2.9 billion.
Waste Management is up 2.9% since the beginning of the year, but at $206.41 per share, it is still trading 14.7% below its 52-week high of $242.10 from June 2025. Investors who bought $1,000 worth of Waste Management’s shares 5 years ago would now be looking at an investment worth $1,930.
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