Waste Management Inc reported a solid QQ3 2024, with revenue of $5.609 billion, up 7.9% year over year and 3.8% quarter over quarter. The quarter delivered a healthy EBITDA of $1.717 billion (EBITDA margin 30.6%), operating income of $1.127 billion (operating margin 20.1%), and net income of $0.76 billion (net margin 13.5%), corresponding to diluted EPS of $1.88-$1.89. Free cash flow ($577 million) and robust operating cash flow ($1.359 billion) underscore the company’s ability to fund dividends and capital expenditure while maintaining a sizable net debt position. Net debt stood at approximately $16.0 billion against total assets of $34.73 billion, with a debt-to-capitalization metric near 0.676 and a current ratio of 0.89, signaling liquidity below 1x on a strict current-basis but supported by strong cash conversion and ongoing capex discipline.
The quarter's results point to stable underlying demand for integrated waste management services in North America, supported by pricing power and efficiency gains in collection, transfer, and disposal operations. Profitability remains resilient despite the high capital intensity of the business and a sizable debt load, as evidenced by an interest-coverage ratio of about 8.6x and sizable free cash flow generation. Management commentary (where available) has historically underscored the importance of disciplined capital allocation—balancing dividends, debt reduction, and selective growth investments—an approach the QQ3 2024 results appear to reinforce. While revenue growth and margins are solid, the elevated leverage remains a key consideration for investors given sensitivity to interest rates and regulatory cycles.
Looking ahead, the absence of explicit forward guidance in the provided materials necessitates reliance on the company’s cash-generative profile, industry fundamentals, and the trajectory of capital allocation. Investors should monitor debt repayment progress, capital expenditure plans, recycling/commodity pricing dynamics, and regulatory developments that could influence costs and volumes. Overall, the QQ3 2024 results reinforce Waste Management’s role as a cash-generating, shareholder-friendly utility-like player within Industrials, albeit with meaningful leverage that requires careful ongoing management.