Is Waste Connections a Smart Buy for Diversified Portfolios?
August 21, 6:23 am
As markets remain volatile and tech stocks dominate headlines, investors looking to build resilient, diversified portfolios are turning their attention to more stable sectors. One company that stands out in this environment is Waste Connections (NYSE: WCN), a North American leader in solid waste collection and disposal services. With consistent financial performance, growing operations, and rising interest across alternative data sources, Waste Connections may be an underrated asset worth considering.
A Steady Financial Performer in a Defensive Sector
Waste Connections currently boasts a market capitalization of around $47.5 billion. While some argue this valuation looks stretched based on trailing earnings (with a P/E ratio around 74x), forward-looking estimates and intrinsic value models paint a different picture. Analyst consensus points to a fair value between $210–$215 per share, suggesting a potential 13–15% upside from current levels - which is aligned with our price prediction.
In its most recent quarterly earnings report, Waste Connections delivered $1.29 in EPS, beating Wall Street estimates by $0.04. Revenue grew to $2.41 billion, a 7.1% year-over-year increase. The company’s consistent performance is backed by an active acquisition strategy - adding $200 million in annualized revenue over the past year alone, with more deals in the pipeline. Combine this with a modest dividend yield (~0.7%) and solid institutional ownership (~86%), and WCN emerges as a strong candidate for income and growth-focused investors alike.
What Alternative Data Reveals About Growth Momentum
At AltIndex, we’ve been tracking alternative data insights on Waste Connections for years, and the latest trends are signaling growth and operational strength across several data points:
- Web Traffic Surge: Interest in Waste Connections is on the rise. Our estimates show that web traffic hit an all-time high in July. This uptick in digital engagement could translate into higher customer acquisition and greater market penetration.
- Social Media Growth: Consumer engagement is rising steadily. Over the past year, Instagram followers are up 19% and YouTube subscribers have jumped 35%. This suggests that brand visibility is growing, particularly among younger, digital-native audiences.
- Headcount Expansion: LinkedIn data shows a 12.8% increase in employee headcount over the last year - a strong indicator that the company is not only growing but investing in its future operations.
- Positive Employee Sentiment: According to employee review platforms, 73% of Waste Connections’ workforce now reports a positive business outlook, up 9% from a year ago. This internal optimism can often precede stronger performance and innovation.
Conclusion: A Stable Growth Pick with Momentum
Waste Connections offers investors a compelling mix of stability, growth, and upside potential. While its current valuation may appear elevated when viewed through traditional trailing earnings multiples, forward-looking projections and intrinsic value models suggest it still has room to grow. Combined with strong alternative data signals - rising digital interest, social traction, operational expansion, and improving employee sentiment - the case for Waste Connections as a buy strengthens.
For investors seeking to diversify away from high-volatility sectors and into essential services, Waste Connections could be a smart addition to a long-term, balanced portfolio.
Disclaimer: The information provided is for educational and informational purposes only and should not be construed as financial or investment advice. All investments involve risk, and you should conduct your own research or consult a qualified professional before making any investment decisions.
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