Waste Management (WM) Stock Grew Marginally This Year But Stood Firm Against Pandemic’s Impact

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During the coronavirus pandemic in 2020, Waste Management Inc. (WM), which gathers and disposes of industrial waste, maintained a profitable sector. The business has diversified contracts and, regardless of the self-isolation regime, waste is generated by households.

Waste Management encountered challenges in the second quarter of 2020, as did several other businesses whose customers suspended activities. Year-on-year, sales dropped 10 percent, while adjusted net profits plummeted 20 percent. Overall, sales will be 3.5-5.5 percent lower in the second half of the year than in the second half of 2019.

But the year-on-year fall in sales was 2.7 percent in the third quarter, and EBITDA was close to the record in the third quarter of last year. This year’s EBITDA margin hit a record peak, meaning Waste Management is turning more sales into profit.

Around 70% of the overall income of Waste Treatment is provided for by broad commercial and industrial orders for garbage removal, storage and recycling. During the lockdown period, it was this market that suffered the greatest downturn, but now most orders have recovered, and the sector is close to the highest profitability ever.

Thus, waste management efficiency in 2020 will be just marginally poorer than in 2019. The business has experience of operating in tough times and will definitely be able to continue the cost-cutting steps taken during the duration of COVID-19.

Waste Management, Inc. (WM) was though down -1.08% on Tuesday to conclude the session at $116.82, but over the week, the stock was a bit up by 0.27 percent. Stock’s performance over the past six months rises to about 10 percent but that remained just 2.5 percent since the beginning of the year. The Houston, Texas-based company currently has a market capitalization of more than $49 billion with revenue of over $15 billion generated over the past one year.

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