CA - Waste Connections: Why You Should Pay Up For This Compounder

2024-01-25 07:00:03 ET

Summary

• Waste Connections has a strong track record of M&A and has been one of the best-performing stocks on the TSX.
• The waste management industry is recession-resilient, making WCN a stable and essential business.
• The company has potential for margin improvement and substantial potential for future growth ahead.
• The valuation at 18.9x EBITDA is worth paying up for given its better margins and better growth rate relative to its closest peer.

Please note all $ figures in , not , unless otherwise stated.

Introduction

Waste Connections ( WCN:CA ) (WCN) is the third largest solid waste company in North America and is involved in the process of collecting, transferring, and disposing of non-hazardous waste for customers in the residential, commercial, municipal, industrial, and E&P space. In addition to waste collection, the company does recycling services for materials like cardboard, mixed paper, plastic containers, glass bottles, and ferrous and aluminum metals. As of quarter-end, the company had over $8 billion in annual revenues with 23,000 employees across the United States and Canada....

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