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Tickers in this Article: WM
Waste Management (NYSE:WM) announced its results for the third quarter on October 31, 2012. Waste Management is a provider of integrated waste services in North America. It provides collection, transfer, recycling, disposal and waste-to-energy services.

Earnings season is important to investors because it shows how much profit is left in the company's hand after deducting costs from revenue. SEE: Can Earnings Guidance Accurately Predict The Future?

The Numbers: Waste Management's EPS outpaced analyst estimates while the company's revenues came in below predictions. The company reported adjusted net income of 61 cents per share versus the 53 cents per share estimate and revenues of $3.46 billion versus the $3.51 billion estimate. Revenue fell 1.7% from the same period last year. Slumping revenue in the last quarter ends Waste Management's streak of four consecutive quarters of revenue increases. The company's net income for the quarter was $214 million. This is a 21.3% decline from last year. The company has now reported lower net income in each of the last four quarters.

Management Quote: David P. Steiner, President and Chief Executive Officer of Waste Management, commented, "The third quarter saw some good and improving trends. We saw improvement in both our internal revenue growth from collection and disposal yield and work-day adjusted volumes. Collection and disposal yield improved sequentially for the first time in six quarters, and we saw positive internal revenue growth from both yield and volume in our MSW, C&D and special waste landfill operations. Our overall income from operations margin, as adjusted, improved by 30 basis points despite a significant decline in commodity prices."

A Look Back: Net income has dropped 7.1% year-over-year on average across the last five quarters. Performance was hurt by a 21.3% decline in the most recent quarter from the year-earlier quarter.

Looking Ahead: Over the past 60 days, the outlook for the company's performance next quarter has become increasingly unfavorable. The average estimate for the fourth quarter is 63 cents per share, a drop from 64 cents. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. For the fiscal year, the average estimate has moved down from $2.24 a share to $2.20 over the last 90 days.

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