NYSE$WM

Waste Management Inc · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Reported strong operating performance with over $1 billion in net cash from operating activities and a strong operating EBITDA margin.

Waste Management announced its Q3 2020 financial results, revealing a revenue decline in the collection and disposal business offset by yield growth, improved operating expenses, and a focus on cost management. The company reported strong operating EBITDA and net cash provided by operating activities, highlighting its resilience and strategic initiatives during the pandemic.

  • Revenue declined in the collection and disposal business due to volume declines, partially offset by yield growth.
  • Operating expenses improved due to proactive cost management and lower fuel prices.
  • Total Company operating EBITDA was $1.10 billion, or 28.5% of revenue.
  • Net cash provided by operating activities increased to $1.03 billion.

Headline financials

Total Revenue

$3.86B

Previous: $3.97B-2.7%
EPS (adj)

$1.09

Previous: $1.19-8.4%
Core Price

3.2%

Previous: 4.0%-20.0%
Free Cash Flow

$390M

Previous: $495M-21.2%
Net Income

$390M

Previous: $495M-21.2%
Operating Income

$680M

Previous: $734M-7.4%
Gross Profit

$1.53B

Previous: $1.53B+0.2%
Cash & Equivalents

$703M

Previous: $2.92B-75.9%
Total Assets

$24.8B

Previous: $27.1B-8.6%
Stock-Based Comp

$51M

Previous: $19M+168.4%

Revenue & EPS history

Waste Management · Revenue · Quarterly

$3.86B

Q3 2020-2.7%vs Q3 2019
Beat estimate in 15 of 16 quarters(94%)
ActualEstimate

Forward guidance

The company is well-positioned for a strong finish to the year with positive momentum heading into 2021, driven by customer service digitalization investments, contributions from the acquisition of Advanced Disposal, and progress in transforming the recycling business.

Tailwinds

  • Customer service digitalization investments are the right approach and have been accelerated to reap the benefits sooner.
  • Further contributions are expected from the acquisition of Advanced Disposal.
  • Progress is being made in transforming the recycling business.
  • The company has learned to operate with a lower cost structure.
  • The company is holding on to operating efficiencies and cost savings as volumes recover.

Headwinds

  • Increased competition
  • Pricing actions
  • Failure to implement optimization, growth, and cost savings initiatives and overall business strategy
  • Failure to identify acquisition targets and negotiate attractive terms
  • Failure to consummate or integrate acquisitions

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2020

Historical avgQ3 2020

+0.1%

Avg return

Earnings day

+1.0%

Avg return

5 days after

+2.5%

Avg return

30 days after

52%

38 / 73 earnings

Positive

+8.6%

Q2 2018

Best reaction

-11.3%

Q2 2011

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.2%+0.2%-7.0%
Q4 2025-1.9%-2.8%+4.0%
Q3 2025-4.4%-6.5%+1.7%
Q2 2025+0.3%+1.7%-3.5%
Q1 2025-0.1%+2.1%+3.8%
Q4 2024+6.1%+6.0%+11.1%
Q3 2024+6.0%+3.5%+10.5%
Q2 2024-8.6%-8.3%-4.0%
Q1 2024+1.9%+1.6%+0.0%
Q4 2023+5.6%+6.7%+11.7%
Q3 2023+5.2%+3.5%+10.1%
Q2 2023-4.0%-5.2%-8.5%
Q1 2023-2.4%+0.7%-2.6%
Q4 2022-2.8%-1.9%-3.0%
Q3 2022-4.1%-4.0%-0.4%
Q2 2022+6.2%+5.4%+10.6%
Q1 2022+7.4%+5.4%+1.3%
Q4 2021-2.7%-2.7%+3.3%
Q3 2021-3.7%-0.6%+2.8%
Q2 2021-0.7%+1.1%+4.7%
Q1 2021+1.7%+3.0%+4.9%
Q4 2020-0.5%-2.0%+8.3%
Q3 2020+6.3%+10.5%+8.5%
Q2 2020-0.0%-0.8%+4.0%
Q1 2020+2.5%+1.5%+13.3%
Q4 2019+0.1%+0.5%-16.2%
Q3 2019-3.2%-4.8%-5.3%
Q2 2019+2.3%+1.9%+0.1%
Q1 2019-0.3%+1.2%+2.2%
Q4 2018+0.5%+0.5%+2.4%
Q3 2018-2.6%+1.8%+4.2%
Q2 2018+8.6%+9.1%+11.3%
Q1 2018-0.1%-1.7%-1.4%
Q4 2017+3.1%+2.7%+4.6%
Q3 2017+6.2%+6.0%+3.7%
Q2 2017-0.3%-0.6%+0.3%
Q1 2017-1.9%-1.6%-3.2%
Q4 2016+1.5%+2.1%+3.1%
Q3 2016+1.0%+4.7%+11.6%
Q2 2016-1.5%-1.3%-5.0%
Q1 2016+4.2%
Q4 2015+1.1%
Q3 2015+2.7%
Q2 2015+2.2%
Q1 2015-5.6%
Q4 2014+6.5%
Q3 2014+0.3%
Q2 2014+3.4%
Q1 2014+2.5%
Q4 2013-5.7%
Q3 2013-2.5%
Q2 2013+0.4%
Q1 2013+3.4%
Q4 2012+0.1%
Q3 2012+1.4%
Q2 2012+5.3%
Q1 2012-5.1%
Q4 2011-1.2%
Q3 2011-2.8%
Q2 2011-11.3%
Q1 2011+1.3%
Q4 2010+0.1%
Q3 2010-1.0%
Q2 2010+1.3%
Q1 2009-1.7%
Q1 2010+0.4%
Q4 2009+3.7%
Q3 2009-2.4%
Q3 2008-2.4%
Q2 2009-4.6%
Q4 2008-4.6%
Q4 2007-4.6%
Q2 2008-4.6%

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