Waste Management Q3 test pits growth against leverage

By Grace Kim

Waste Management Inc. was preparing to report third-quarter earnings after market close on October 27, 2026, with analyst estimates of $6.81 billion in revenue and $2.18 in earnings per share. GuruFocus, reporting on October 26, cited year-over-year growth of 5.7% for revenue and 46.3% for EPS.

GuruFocus said investors will watch dividend sustainability and intrinsic value alongside the results. Founded in 1968 and headquartered in Houston, the company serves more than 20 million customers across the United States and Canada through waste collection, recycling and disposal operations.

GuruFocus identified WM as North America’s largest environmental services provider, placed it in the waste management industry within the Industrials sector and put its market capitalization at $96.34 billion at publication. The service attributes WM’s durable competitive advantage to its extensive landfill and transfer-station network.

GuruFocus identified automated recycling and renewable natural gas projects as strategic investments supporting growth. It provided no tonnage, plant capacity, capital cost or completion date for those projects, leaving their execution outside the stock alert’s numerical benchmark.

What does the earnings release need to show for the dividend case to remain intact?

WM must first show that forecast earnings can support both the payout and its strategic investments. Its dividend yield stands at 1.67%, supported by a payout ratio of 50%, which GuruFocus calls conservative, and three-year dividend growth of 8.3%.

GuruFocus characterized that combination as making the dividend both “safe and appealing,” while noting that it left half of earnings for reinvestment. The judgment remains prospective until WM publishes the quarterly figures that test earnings coverage.

The deeper test will be whether WM can meet estimates while carrying an elevated debt-to-equity ratio of 2.35. GuruFocus linked that leverage, and $6.3 billion of debt issued over three years, partly to WM’s 4/10 financial-strength rating.

At $241.02, WM shares traded about 3.5% below GuruFocus’s $249.77 GF Value, which the service called “fairly valued overall.” The metric draws on historical multiples, business growth and future earnings estimates.

WM’s trailing 12-month P/E ratio stood at 34.11, slightly above its five-year median of 33.01. GuruFocus described that premium as near historical levels rather than excessive.

Growth ratings outweigh leverage in the 84/100 score

GuruFocus’s 84/100 GF Score synthesizes financial strength, profitability, growth, valuation and momentum. Its component ratings split sharply:

• Profitability: 9/10
• Growth: 9/10
• Valuation: 9/10
• Financial strength: 4/10
• Momentum: 2/10

GuruFocus tied the 9/10 profitability, growth and valuation scores to efficient operations, consistent earnings expansion and a reasonable price relative to estimated intrinsic value. The 2/10 momentum mark reflected recent stock-price trends below peers, while the 4/10 financial-strength mark captured heavier balance-sheet risk.

Despite those offsets, GuruFocus presents WM as a high-quality business and an attractive dividend stock for investors seeking income and growth. It cites the 1.67% yield, 50% payout ratio, earnings growth and relative valuation as support, while treating insider selling and financial leverage as the main cautions.

Ownership and forecast records send mixed signals

Ownership data offers two opposing signals. Twelve gurus tracked by GuruFocus hold WM shares; seven increased positions in recent quarters and three trimmed them.

Over the previous 12 months, insiders sold $24.2 million of WM stock and purchased $0.4 million. GuruFocus said the net selling warrants attention but is not uncommon among large-capitalization companies, while it characterized broader institutional sentiment as mixed but generally positive.

WM’s two-year forecast record argues for close attention to both lines. The company beat EPS estimates 63% of the time but beat revenue forecasts only 25% of the time, according to GuruFocus.

That split places more weight on the $6.81 billion revenue estimate when assessing the landfill, transfer-station and collection network. The 46.3% EPS growth assumption remains the larger year-over-year swing.

GuruFocus generated the stock alert using automated technology and its financial data, then reviewed it through its editorial team. The proprietary scores and estimates remain GuruFocus analytical inputs rather than WM guidance; the company’s Oct. 27 release will provide the operating and financial results investors can test.

The decisive market milestone arrives after market close on October 27. Investors can compare reported revenue and EPS with $6.81 billion and $2.18, then assess dividend coverage and debt trends; until then, the 84/100 score and 1.67% yield remain indicators rather than operating proof.