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Waste Management Inc Scores 85% in Growth Investor Model

Waste Management Inc showcases promising fundamentals with an 85% rating using the Growth Investor model, indicating strong investor interest. However, despite strong growth in sales, the revenue growth relative to EPS growth is a concern.

Date: 
AI Rating:   7
Analysis of Waste Management Inc

Waste Management Inc (WM) has received an impressive rating of 85% according to the Growth Investor model, which indicates a strong interest from the investment community. This rating signifies that the company demonstrates persistent accelerating earnings and sales growth, reasonable valuations, and low debt levels.

Several key metrics analyzed reveal strong performance:

  • P/E Ratio: The company passes this metric, which indicates reasonable valuation relative to earnings.
  • Sales Growth Rate: WM passes, showcasing a strong sales growth rate, a positive signal for future revenue potential.
  • Current Quarter Earnings: The stock has passed this test, indicating good earnings performance in its most recent quarter.
  • Quarterly Earnings from One Year Ago: WM also shows positive performance compared to the same period last year.
  • Positive Earnings Growth Rate for Current Quarter: Another pass reinforces stability in earnings during the current quarter.
  • EPS Growth for Current Quarter: This must be greater than prior quarters, and WM has successfully passed this criterion.
  • Long-Term EPS Growth: WM has a positive long-term outlook regarding earnings per share.
  • Total Debt/Equity Ratio: Another positive sign indicating lower financial risk.

However, a critical point of concern arises with the Revenue Growth in Relation to EPS Growth, where WM has failed. This implies that while the sales figures are strong, there may be a disconnect in converting that sales growth into proportional earnings growth, which could concern investors seeking sustainable profitability.

Investors should take note that while the overall outlook for Waste Management Inc appears strong, they must remain cautious about the missed mark on revenue growth relative to EPS growth. This could potentially affect future investor sentiment and stock price performances in the short term.

Stocks:  WM