For immediate release
Chicago, IL – December 6, 2021 – Today, Zacks Investment Ideas presents Highlights Features: VanEck Environmental Services ETF EVX, Republic Services, Inc. RSG, Waste Management, Inc. WM and Waste Connections, Inc. WCN.
Don’t “Waste” This Opportunity To Buy These 3 Outperformers
Here’s an unpopular truth about investing: a good investment can sometimes be boring. While it can be exhilarating trying to jump into the next big growth story quickly, allowing strong companies to drive growth in your portfolio over time will more often than not pay big dividends down the road.
Waste removal is an industry that is not very glamorous. Yet when some of the world’s leading financial institutions are the biggest holders of these stocks, there’s a good reason for it and you better pay attention.
The VanEck Environmental Services ETF tracks the performance of companies involved in waste collection, transfer and disposal services, recycling, soil remediation, waste water management and environmental consultancy services. EVX has outperformed major indices this year with a return of almost 27%.
The three waste disposal companies we’ll discuss below are the top three constituents of EVX, bringing together nearly 30% of the ETF’s total holdings. Volatility has been the name of the game over the past few weeks for the general market, but these three companies are still trading within a few percent of their respective 52-week highs.
Stocks that are resilient to market corrections tend to lead when indices resume their uptrend. Let’s take a closer look at these three waste removal companies that are showing strength this year.
Republic Services provides waste collection, recycling, disposal and energy services to commercial, industrial, municipal and residential customers in the United States and Puerto Rico. Based in Phoenix, AZ, RSG operates more than 300 collection facilities in 39 different states.
At Zacks #2 Buy stock, RSG has put together a remarkable track record of earnings surprises, beating estimates in each of the past 20 quarters. The company recently reported EPS for the quarter ending September of $0.08, a surprise of 7.8% from estimates. RSG has a four-quarter average earnings surprise of 14.2%, which supported the stock’s 42% return for the year.
RSG management continues to increase its guidance and consistency with dividend payouts and share buybacks will ensure that investor confidence remains strong. Analysts covering the business have revised their full-year earnings estimates up nearly 2% in the past 60 days to $4.14, a growth rate of 16.3% compared to 2020. RSG’s next earnings report is due out on February 28.and, 2022.
Waste Management is a leading provider of integrated environmental solutions in North America, serving municipal, commercial and industrial customers. Based in Houston, TX, WM has the largest network of recycling and landfill facilities in the industry, and its natural gas truck fleet is the largest heavy-duty truck fleet in North America.
WM, currently a Zacks #3 Hold, has built a solid record of earnings surprises, beating consensus estimates in 16 of its past 17 quarters. WM stock is up more than 40% this year on the heels of a 3.5% surprise on average earnings over the past four quarters.
Dividend payouts and share buybacks continued to support the stock. Zacks consensus estimates for revenue and EPS for the current year are $17.81 billion (17.1% growth) and $4.84 (20.1% growth), respectively. WM is then due to release its quarterly results on February 17.and, 2022.
Waste Connections is an integrated solid waste management services company, providing collection, transfer and disposal services in exclusive and secondary markets. The company also provides intermodal services for the movement of freight and solid waste containers. WCN primarily operates in the United States and is headquartered in The Woodlands, TX.
WCN has a Zacks #3 Hold rank and has had a remarkable history of earnings surprises, beating estimates in each of the last twenty quarters. The company recently reported end-October earnings of $0.89, a 4.7% surprise on consensus. WCN has produced an average earnings surprise of 6% over the past four quarters, boosting the stock’s return 32% year-to-date.
Analysts have revised annual earnings estimates up 2.2% over the past 60 days, anticipating EPS of $3.22. This translates to a respectable growth rate of 22% from 2020 EPS of $2.64. WCN’s next earnings report is due February 16and, 2022.
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Past performance is not indicative of future results. The potential for loss is inherent in any investment. This document is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether any investment is suitable for any particular investor. It should not be assumed that investments in the securities, companies, sectors or markets identified and described have been or will be profitable. All information is current as of the date hereof and is subject to change without notice. The views or opinions expressed may not reflect those of the company as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management of securities. These returns come from hypothetical portfolios composed of stocks with Zacks Rank = 1 that have been rebalanced monthly without transaction fees. These are not the returns of actual stock portfolios. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for more information on the performance figures displayed in this press release.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.