Waste Management (WM) Stock Forecast & Price Target

Waste Management's stock outlook is bolstered by significant operational growth, demonstrated by a 5.2% year-over-year increase in landfill volumes across multiple waste segments, reflecting strong demand and resilient market conditions. The company achieved an expansion of its Collection & Disposal AEBITDA margin by 100 basis points year-over-year in the third quarter of fiscal year 2025, alongside a notable improvement in SG&A by 700 basis points, indicating enhanced operational efficiency. Furthermore, Waste Management plans to return approximately 90% of its targeted $3.8 billion free cash flow for fiscal year 2026 to shareholders, marking a substantial 162% year-over-year increase in capital returns, further enhancing shareholder value.

Waste Management is currently facing several fundamental challenges that raise concerns about its financial performance and outlook. Recent reports indicate a decline in Adjusted EBITDA and revenue figures that fell short of both consensus estimates and company guidance, largely attributable to slower synergy capture and reduced sales in key areas such as recycled commodities and WM Healthcare Solutions. Additionally, anticipated changes in renewable fuel standards and the company's struggle with lower growth and margins in the Stericycle business further complicate its revenue projections, contributing to an overall negative sentiment regarding its stock.