Waste Connections (WCN) Stock Forecast & Price Target

Waste Connections has demonstrated a positive trajectory in its financial performance, highlighted by a year-over-year Adj. EBITDA margin increase of 12 basis points, supported by improved voluntary turnover and an expectation for significant profitability ramp-up by 2026. The firm experienced solid waste core pricing resilience at 6.6%, coupled with operational improvements that contributed to same-store margin expansion, despite encountering a 20 basis point headwind. Furthermore, the company reported a 2.4% year-over-year organic revenue growth in Q2, primarily driven by pricing, indicating robust demand in its core segments and underlying margin expansion amidst challenging commodity market conditions.

Waste Connections is facing a negative outlook due to several fundamental factors. The company's solid waste volume has declined by 2.6%, reflecting ongoing macroeconomic uncertainties and a strategic reduction of low-quality volumes. Additionally, revised guidance indicates that solid waste volumes are expected to be 0.5% worse than initially projected, combined with headwinds from falling recycled commodity prices, which are forecasted to negatively impact revenue by $30 million in the second half of the year.