Upcoming AWS Coverage on Advanced Disposal Services Post-Earnings Results

LONDON, UK / ACCESSWIRE / May 2, 2017 / Active Wall St. announces its post-earnings coverage on Waste Management, Inc. (NYSE: WM). The Company posted its first quarter fiscal 2017 results on April 26, 2017. The garbage and recycling hauler surpassed revenue expectations and also re-affirmed its fiscal 2017 earnings and cash flow outlook. Register with us now for your free membership at:

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One of Waste Management's competitors within the Waste Management space, Advanced Disposal Services, Inc. (NYSE: ADSW), announced on April 05, 2017, that it will release first quarter results on May 04, 2017 after closing and host its investor conference call at 10:00 a.m. ET on May 5, 2017. AWS will be initiating a research report on Advanced Disposal Services in the coming days.

Today, AWS is promoting its earnings coverage on WM; touching on ADSW. Get our free coverage by signing up to:

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Earnings Reviewed

For the three months ended March 31, 2017, Waste Management's revenues were $3.44 billion compared with $3.18 billion for Q1 2016. The Company's revenue numbers surpassed analysts' consensus of $3.32 billion.

For Q1 2017, Waste Management's net income was $298 million, or $0.67 per diluted share, compared with $258 million, or $0.58 per diluted share, for Q1 2016. On an as-adjusted basis, excluding certain items, the Company's net income was $291 million, or $0.66 per diluted share, in the reported quarter. Waste Management's as-adjusted Q1 2017 results exclude a $0.07 per diluted share tax benefit related to equity-based compensation and a non-cash charge of $0.06 per diluted share related to the impairment of an equity investment in a waste diversion technology Company. Waste Management's earnings numbers met Wall Street's estimates of $0.66 per share.

Operating Results

For Q1 2017, Waste Management's overall revenue increased by 8.3%, or $264 million, the largest organic growth the Company has generated in over a decade. The increase in revenue was driven by positive yield and volume in the Company's collection and disposal business, which contributed $113 million to revenue growth, and significantly higher recycling commodity prices, which contributed $111 million of revenue growth.

During Q1 2017, Waste Management's core price, which consists of price increases net of rollbacks plus fees other than the Company's fuel surcharge, was 5.1%. The Company's internal revenue growth from yield for collection and disposal operations was 2.0%.

For both the total Company and the traditional solid waste business, internal revenue growth from volume was positive 1.9% in Q1 2017, or 1.4% after adjusting for one additional workday in the reported quarter. During Q1 2017, average recycling commodity prices at the Company's recycling facilities were approximately 70% higher on a y-o-y basis.

During Q1 2017, as a percent of revenue, Waste Management's operating expenses were 63.0% compared to 62.8% in Q1 2016. The increase in operating expense was attributed to increased recycling commodity rebates and fuel costs. Fuel costs were a negative $0.02 per diluted share when compared to the prior year's same period.

Cash Balance

For Q1 2017, net cash provided by Waste Management's operating activities was $721 million compared to $732 million in Q1 2016. The prior year's same quarter included a $67 million benefit from terminating a cross-currency hedge. Capital expenditures were $332 million in the reported quarter, an increase of $15 million on a y-o-y basis. Waste Management generated free cash flow of $396 million in Q1 2017 compared to $428 million in Q1 2016. The Company returned $194 million to shareholders during the reported quarter in dividends.

At the end of Q1 2017, Waste Management's debt-to-EBITDA ratio, measured based on the Company's bank covenants, was 2.4. Waste Management's weighted average cost of debt for the reported quarter was about 4.2%, and the floating rate portion of its total debt portfolio was 12% at the end of Q1 2017.

Outlook

Waste Management reaffirmed its FY17 EPS guidance in the range of $3.14 to $3.18 and full year free cash flow forecast to be between $1.5 billion to $1.6 billion.

Stock Performance

At the closing bell, on Monday, May 01, 2017, Waste Management's stock was slightly up 0.32%, ending the trading session at $73.01. A total volume of 1.72 million shares were traded at the end of the day, which was higher than the 3-month average volume of 1.56 million shares. In the last six months and previous twelve months, shares of the Company have rallied 16.59% and 27.31%, respectively. Moreover, the stock gained 3.57% since the start of the year. The Company's shares are trading at a PE ratio of 26.61 and have a dividend yield of 2.33%. At Monday's closing price, the stock's net capitalization stands at $32.29 billion.

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SOURCE: Active Wall Street