MMarketMath

WM

StalwartQuality: High (75/100)1 red flag

Waste Management · Industrials · Environmental & Facilities Services

$226.46

52w 194.11 – 248.13

20y monthly, adjusted

Mkt cap

$90.5B

P/E

33.1

P/FCF

31.8

FCF yield

3.1%

ROE

27.1%

Shldr yield

1.5%

div 1.5% + bb 0.0%

What today's price assumes

At $90.5B, the market is pricing in 14.0% annual free-cash-flow growth for the next decade (10% discount rate, 2.5% terminal growth). Over the last ten years, FCF actually grew 8.0% per year — the price asks for acceleration beyond the historical record.

Simple DCF per-share range: $107 · $144 · $180 (4% / base / optimistic growth). An estimate, not a target.

Adjust the assumptions yourself →

Historical multiple lens

At its own median P/OCF of 9.5× across 18 years, WM would trade near $143/share (25th–75th percentile: $86–$200); it trades at 15.0× today.

Assumes the historical multiple regime persists — re-ratings can be permanent.

Growth record

Compound annual growth rates from as-filed 10-K data, split-adjusted

Rev 3y

+8.6%

Rev 5y

+10.6%

Rev 10y

+6.9%

EPS 5y

+13.7%

EPS 10y

+15.0%

FCF 5y

+9.1%

FCF 10y

+8.0%

Fundamentals

Fiscal 2007–2025, from SEC filings

Revenue

2007: $13.3B
2008: $13.4B
2009: $11.8B
2010: $12.5B
2011: $13.4B
2012: $13.6B
2013: $14.0B
2014: $14.0B
2015: $13.0B
2016: $13.6B
2017: $14.5B
2018: $14.9B
2019: $15.5B
2020: $15.2B
2021: $17.9B
2022: $19.7B
2023: $20.4B
2024: $22.1B
2025: $25.2B
$0$10.0B$20.0B
07
11
15
19
23

Net income

2007: $1.2B
2008: $1.1B
2009: $994.0M
2010: $953.0M
2011: $961.0M
2012: $817.0M
2013: $98.0M
2014: $1.3B
2015: $753.0M
2016: $1.2B
2017: $1.9B
2018: $1.9B
2019: $1.7B
2020: $1.5B
2021: $1.8B
2022: $2.2B
2023: $2.3B
2024: $2.7B
2025: $2.7B
$0$1.0B$2.0B
07
11
15
19
23

Free cash flow

2007: $1.2B
2008: $1.4B
2009: $1.2B
2010: $1.2B
2011: $1.1B
2012: $785.0M
2013: $1.2B
2014: $1.1B
2015: $1.3B
2016: $1.7B
2017: $1.6B
2018: $1.9B
2019: $2.1B
2020: $1.8B
2021: $2.3B
2022: $1.7B
2023: $1.8B
2024: $2.2B
2025: $2.8B
$0$1.0B$2.0B
07
11
15
19
23

Diluted shares (lower is better)

2008: 495.4M
2009: 493.6M
2010: 482.2M
2011: 471.4M
2012: 464.4M
2013: 469.8M
2014: 465.6M
2015: 455.9M
2016: 446.5M
2017: 441.9M
2018: 432.2M
2019: 427.5M
2020: 425.1M
2021: 422.9M
2022: 415.0M
2023: 406.9M
2024: 403.4M
2025: 404.2M
0200.0M400.0M
07
11
15
19
23

Margins

0%5%10%07101316192225
Net marginFCF marginGross margin

Capital returned (dividends + buybacks)

2007: $1.9B
2008: $941.0M
2009: $795.0M
2010: $1.1B
2011: $1.2B
2012: $658.0M
2013: $922.0M
2014: $1.3B
2015: $1.3B
2016: $1.5B
2017: $1.5B
2018: $1.8B
2019: $1.1B
2020: $1.3B
2021: $2.3B
2022: $2.6B
2023: $2.4B
2024: $1.5B
2025: $1.3B
$0$1.0B$2.0B
07
11
15
19
23

Cash vs long-term debt

$0$10.0B$20.0B07101316192225
CashLT debt

Quarterly

Discrete quarters from 10-Q filings; Q4 derived as fiscal year minus Q1–Q3. OCF is unwound from the year-to-date figures 10-Qs report. Compare to the same quarter a year ago — most businesses are seasonal.

Revenue by quarter

Q2'23: $5.1B
Q3'23: $5.2B
Q4'23: $5.2B
Q1'24: $5.2B
Q2'24: $5.4B
Q3'24: $5.6B
Q4'24: $5.9B
Q1'25: $6.0B
Q2'25: $6.4B
Q3'25: $6.4B
Q4'25: $6.3B
Q1'26: $6.2B
Q2'26: $6.7B
$0$2.0B$4.0B$6.0B
23
24
24
25
26

Net income by quarter

Q2'23: $615.0M
Q3'23: $663.0M
Q4'23: $493.0M
Q1'24: $708.0M
Q2'24: $680.0M
Q3'24: $760.0M
Q4'24: $598.0M
Q1'25: $637.0M
Q2'25: $726.0M
Q3'25: $603.0M
Q4'25: $742.0M
Q1'26: $723.0M
Q2'26: $785.0M
$0$200.0M$400.0M$600.0M
23
24
24
25
26
QuarterRevenueYoYNet incomeYoYEPSOCF
Q2'26$6.7B+4.0%$785.0M+8.1%1.95$1.7B
Q1'26$6.2B+3.5%$723.0M+13.5%1.79$1.5B
Q4'25 *$6.3B+7.1%$742.0M+24.1%1.83$1.7B
Q3'25$6.4B+14.9%$603.0M−20.7%1.49$1.6B
Q2'25$6.4B+19.0%$726.0M+6.8%1.80$1.5B
Q1'25$6.0B+16.7%$637.0M−10.0%1.58$1.2B
Q4'24 *$5.9B+13.0%$598.0M+21.3%1.49$1.5B
Q3'24$5.6B+7.9%$760.0M+14.6%1.88$1.4B
Q2'24$5.4B+5.5%$680.0M+10.6%1.69$1.2B
Q1'24$5.2B+5.5%$708.0M+32.8%1.75$1.4B
Q4'23 *$5.2B+5.7%$493.0M−1.2%1.22$1.4B
Q3'23$5.2B+2.4%$663.0M+3.8%1.63$1.3B
Q2'23$5.1B+1.8%$615.0M+4.8%1.51$1.0B

Track record

Compound annual growth by period. For debt and share count, negative is the good direction.

Series3y5y10y15y
Revenue+8.6%+10.6%+6.9%+4.8%
Operating cash flow+10.0%+12.2%+9.1%+6.7%
Free cash flow+17.7%+9.1%+8.0%+6.0%
EPS (diluted)+7.5%+13.7%+15.0%+8.5%
Equity+13.4%+6.0%+6.5%+3.2%
LT debt+15.1%+10.9%+9.8%+6.5%
Diluted shares−0.9%−1.0%−1.2%−1.2%
Stock price+14.8%+9.6%+15.5%+16.4%

$100, 3 years ago

$151vs $176 in SPY

14.8% vs 20.7%/yr

$100, 5 years ago

$158vs $181 in SPY

9.6% vs 12.6%/yr

$100, 10 years ago

$424vs $412 in SPY

15.5% vs 15.2%/yr

$100, 15 years ago

$980vs $813 in SPY

16.4% vs 15.0%/yr

The $1 test — market value created per $1 of earnings retained (Buffett's hurdle: at least $1)

Last 5 years

$7.51

$45.7B created / $6.1B retained

Last 10 years

$6.77

$69.2B created / $10.2B retained

Quality & capital discipline

Cash-based returns and how management deploys capital

Cash ROIC

18.8%

OCF ÷ (equity + debt)

OCF / EV yield

5.4%

MC vs 10× OCF

1.48

≤1 = priced under 10× OCF

Debt / FCF

7.9y

SBC / FCF

6.0%

Owner earnings

$2.6B

OCF − capex − SBC

OE yield

3.0%

Share count 5y

−1.2%

per year; negative = buybacks

Capital intensity

—

net PP&E ÷ revenue

Sales efficiency

$1.53

new PP&E per $1 new revenue, 5y

Growth engine (5y): reinvested 47.3% of operating cash flow at an incremental return of 22.3% — an organically fundable growth rate of about 10.5% per year (growth ≈ reinvestment rate × incremental ROIC).

Checklist

19 of 25 checks pass · 76%. Checks with structurally missing inputs are excluded.

Growth & Consistency

7/7

  • Revenue growth

    10.6% · 5y CAGR ≥ 5%

    pass

  • EPS growth

    13.7% · 5y CAGR ≥ 5%

    pass

  • FCF growth

    9.1% · 5y CAGR ≥ 5%

    pass

  • Revenue rises consistently

    8 of 9 · up in ≥ 7 of last 10 years

    pass

  • FCF consistently positive

    10 of 10 · positive in ≥ 8 of last 10 years

    pass

  • Profitable every year

    10 of 10 · net income > 0 in ≥ 8 of last 10

    pass

  • Cash flow keeps up with sales

    12.2% vs 10.6% · OCF CAGR ≥ 0.9× revenue CAGR

    pass

Profitability

6/6

  • Net margin

    10.7% · ≥ 8%

    pass

  • Operating margin

    17.1% · ≥ 10%

    pass

  • Gross margin stable or rising

    — · no drop > 2 pts over 3y

    na

  • Return on equity

    27.1% · ≥ 12%

    pass

  • Cash ROIC

    18.8% · ≥ 12%

    pass

  • FCF margin

    11.2% · ≥ 5%

    pass

  • Earnings back their cash

    OCF $6.0B vs NI $2.7B · OCF ≥ net income (latest FY)

    pass

Balance Sheet

1/4

  • Debt payable from cash flow

    7.9y · LT debt ≤ 3× FCF

    fail

  • Cash cushion

    1% · cash ≥ 50% of LT debt

    fail

  • Leverage

    2.22 · LT debt ≤ 1.5× equity

    fail

  • Equity positive and compounding

    $10.0B · equity > 0 and grew over ~5y

    pass

  • Interest burden

    — · interest ≤ 15% of operating income

    na

Capital Allocation

4/4

  • Share count flat or shrinking

    -1.2% · ≤ +0.5%/yr over ~5y

    pass

  • Stock comp restrained

    6% · SBC ≤ 15% of FCF

    pass

  • Distributions funded by FCF

    47% · dividends + buybacks ≤ 100% of FCF

    pass

  • Repurchases are a habit

    9 of 10 · buybacks in ≥ 5 of last 10 years

    pass

Valuation Discipline

1/4

  • FCF yield

    3.1% · ≥ 3%

    pass

  • Earnings multiple

    33.1 · P/E ≤ 25

    fail

  • Price asks less than history delivered

    14.0% vs 8.0% · implied FCF growth ≤ historical FCF CAGR

    fail

  • Shareholder yield

    1.5% · dividends + buybacks ≥ 2% of market cap

    fail

Red flags

Mechanical checks — a flag is a question to investigate, not a verdict

Heavy debt load

Long-term debt exceeds 5 years of free cash flow.

Financial data

As filed in 10-Ks; per-share figures split-adjusted. $ in millions.

FYRevenueGross profitOp incomeNet incomeEPSOCFCapExFCFDividendsBuybacksSBCCashLT debtEquityShares
202525,204—4,3082,7086.706,0433,2272,8161,334—16920122,1969,990404
202422,063—4,0632,7466.815,3903,2312,1591,21026211841422,5418,252403
202320,426—3,5752,3045.664,7192,8951,8241,1361,3029345815,8956,903407
202219,698—3,3652,2385.394,5362,8091,7271,0771,5008435114,5706,849415
202117,931—2,9651,8164.294,3382,0392,2999701,35010811812,6977,124423
202015,218—2,4341,4963.523,4031,5851,8189274029455313,2597,452425
201915,455—2,7061,6703.913,8741,8152,059876248863,56113,2807,068428
201814,914—2,7891,9254.453,5701,6711,8998021,00489619,5946,275432
201714,485—2,6361,9494.413,1801,5681,612750750101228,7526,019442
201613,609—2,2961,1822.653,0031,3471,65672672590328,8935,297447
201512,961—2,0457531.652,5281,2291,29969560072398,6765,345456
201413,996—2,2991,2982.792,3311,1811,150693600651,3078,3455,866466
201313,983—1,079980.212,4551,2671,18868323958589,5005,707470
201213,649—1,8518171.762,2951,510785658—291949,1736,354464
201113,378—2,0289612.042,4691,3241,145637575452589,1256,070471
201012,515—2,1169531.982,2751,1041,171604501365398,6746,260482
200911,791—1,8879942.012,3621,1791,183569226301,1408,1246,285494
200813,388—2,2341,0872.192,5751,2211,354531410484807,4915,902495
200713,310—2,2541,1632.232,4391,2111,2284951,42137348—6,102—

Some concepts are structurally absent for certain industries (banks report no gross profit or capex). Missing ≠ zero.

Compare with peers →·10-K filings on EDGAR ↗