Waste Management, Inc. (NYSE:WM) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.
Waste Management, Inc. Earnings Cheat Sheet
Results: Adjusted Earnings Per Share increased 9.62% to $0.57 in the quarter versus EPS of $0.52 in the year-earlier quarter.
Revenue: Rose 1.94% to $3.53 billion from the year-earlier quarter.
Actual vs. Wall St. Expectations: Waste Management, Inc. reported adjusted EPS income of $0.57 per share. By that measure, the company beat the mean analyst estimate of $0.55. It missed the average revenue estimate of $3.55 billion.
Quoting Management: David P. Steiner, President and Chief Executive Officer of Waste Management, commented, “In the second quarter, our earnings per share grew to $0.54 in spite of the negative impact of $0.03 of unexpected headwinds. We had $0.02 more headwind from our recycling operations than we expected and a negative $0.01 from litigation settlements. Without these headwinds, we would have earned $0.57 per share. Income from operations in our traditional solid waste business grew $47 million and the related income from operations margin grew 80 basis points. These strong results were driven by collection and disposal yield of 2.1% for the second quarter. We also achieved SG&A cost savings of $21 million, despite nearly $30 million of incremental incentive compensation accruals.”
Key Stats (on next page)…
Revenue increased 5.7% from $3.34 billion in the previous quarter. EPS increased 42.5% from $0.40 in the previous quarter.
Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.63 to a profit $0.62. For the current year, the average estimate has moved up from a profit of $2.17 to a profit of $2.18 over the last ninety days.
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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)