WM to CWST: 5 recycling stocks to watch as climate takes center stage

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WM to CWST: 5 recycling stocks to watch as climate takes center stage

WM to CWST: 5 recycling stocks to watch as climate takes center stage
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Highlights

  • Waste Management, Inc.'s (NYSE: WM) P/E ratio is 34.94, and its dividend yield is 1.63%.
  • Republic Services, Inc. (NYSE: RSG) has a P/E ratio of 32.26. Its dividend yield is 1.38%. 
  • Waste Connections, Inc.'s (NYSE: WCN) P/E ratio is 52.0, and the dividend yield is 0.69%.

According to the US Environmental Protection Agency (EPA), pollution prevention is any practise which contributes to reducing, eliminating, and preventing pollution. People are getting aware of the harmful effects of plastic waste on the world, and organizations and individuals are supporting the cause of recycling and waste management. 

With the rising population, responsible handling and processing of waste are essential. According to a report by Energy Department, around 5% of plastic waste is recycled in the US, a dismally low figure. The report, released last week, also shows that about 86% of the 44 million metric tons of plastic waste in 2019 were sent to landfills, 9% was combusted, and only 5% was recycled, WSJ reported. The recycling and waste management businesses are capital intensive and regulated. Here we discuss five recycling stocks that generated positive returns in one year:

Waste Management, Inc. (NYSE: WM)

Closing price on May 6, 2022: US$158.64
Price range in last 52 weeks: US$170.18 to US$136.97

Houston, Texas-based Waste Management is one of the largest traditional solid waste services providers in the US. It operates around 268 active landfills and about 350 transfer stations. It serves residential, commercial, and industrial end markets.

For the quarter ended March 31, 2022, its revenue was US$4.66 billion compared to US$4.11 billion in the previous year's quarter. The net income of the company came in at US$514 million or US$1.23 per share diluted compared to US$421 million or US$0.99 per share diluted in the same quarter of 2021.  

The stock has a market capitalization of US$65.87. Its P/E ratio is 34.94, and the forward P/E for one year is 29.25. The dividend yield is 1.63%, and annualized dividend is 2.60. 

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Data as on May 6, 2022.

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Republic Services, Inc. (NYSE: RSG)

Closing price on May 6, 2022: US$130.33
Price range in last 52 weeks: US$145.98 to US$106.46

Republic Services is the US's second-largest integrated provider of traditional solid waste services. Phoenix, Arizona-based Republic operates roughly 186 active landfills and over 200 transfer stations serving residential, commercial, and industrial end markets. 

For the March quarter of 2022, it reported a revenue of US$2.97 billion compared to US$2.6 billion in the same quarter a year ago. Its net income was US$352 million or US$1.11 per share diluted compared to US$296 million or US$0.93 per share diluted for the March quarter of 2021.

The company reported cash from operating activities of US$705.6 million. It announced a quarterly dividend of US$0.46 per share for the shareholders of record on July 1. The dividend is payable on July 15, 2022. 

The stock has a market capitalization of US$41.16 billion. Its P/E ratio is 32.26, and the forward P/E for one year is 28.21. The dividend yield is 1.38%, and annualized dividend is 1.84. 

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Waste Connections, Inc. (NYSE: WCN)

Closing price on May 6, 2022: US$127.4
Price range in last 52 weeks: US$145.62 to US$115.75

Vaughan, Ontario-based Waste Connections provides traditional solid waste and recycling services in North America. The company serves residential, commercial, industrial, and energy end markets by operating 91 active landfills, 132 transfer stations, and 68 recycling operations. 

For the March quarter of 2022, it posted a net income attributable to the company of US$180.3 million or US$0.69 per share diluted on revenue of US$1.65 billion. The net income for the same quarter in 2021 was US$160.3 million or US$0.61 per share diluted, on revenue of US$1.4 billion. 

The stock has a market capitalization of US$32.76 billion. Its P/E ratio is 52, and the forward P/E for one year is 35.06. The dividend yield is 0.69%, and annualized dividend is US$0.92. 

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Clean Harbors, Inc. (NYSE: CLH)

Closing price on May 6, 2022: US$96.08
Price range in last 52 weeks: US$118.89 to US$87.11

Clean Harbors Inc is an environmental, energy, and industrial services provider. The Norwell, Massachusetts-based company provides cleaning and related services to commercial, industrial, and automotive customers. 

For the three months ended March 31, 2022, the company reported a revenue of US$1.17 billion, a 45% increase YoY compared to US$0.808 billion in the same quarter in the previous year. The net income came in at US$45.3 million or US$0.83 per diluted share compared to US$21.7 million or US$0.39 per share diluted in the March quarter of 2021.

The stock has a market capitalization of US$5.31 billion. Its P/E ratio is 23.15. The forward P/E for one year is 23.06. 

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Casella Waste Systems, Inc. (NASDAQ: CWST)

Closing price on May 6, 2022: US$75.72
Price range in last 52 weeks: US$92.75 to US$62.47

Casella Waste Systems Inc is a solid waste removal company. It provides resource management services to residential, municipal, commercial, and industrial customers in the US. It is located in Rutland, Vermont. Its services include recycling, collection, landfills, special waste, organics, energy, and professional services.

The company reported a revenue of US$234 million for the quarter ended March 31, 2022, compared to US$189.5 million in the same quarter the previous year. Its net income came in at US$4.19 million or US$0.08 per share diluted compared to US$4.31 million or US$0.08 per share diluted in the March quarter of 2021. 

The stock has a market capitalization of US$3.9 billion. Its P/E ratio is 94.65, and the forward P/E for one year is 74.49. 

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Bottom line:

In the business world, environment, social, and governance (ESG) are taking precedence and organizations are rated based on their measures in these three areas. Governments support green energy, and a greener future is becoming a priority for individuals. However, a proper company analysis is advised before investing in stocks.

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