CWST

Why We Like Republic Services Over Casella

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Image Source: Republic Services Inc – 2018 Annual Report By Callum Turcan Let’s talk about the story of two garbage haulers, one that is extremely pricey and one that we just added to the Dividend Growth Newsletter portfolio. Casella Waste Systems Inc (CWST) has grown from a one truck company back in 1975, building Vermont’s first recycling facility in 1977, to a mid-sized waste disposal and recycling company as of today. The rally in shares of CWST over the past ~5 years has been stunning, with shares up over 12-fold since December 2014. We recently updated our models for Casella and the environmental services industry at-large (those reports can be viewed here), and want to caution our members that the … Read more

Our Reports on Stocks in the Environmental Services Industry

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Image: Republic’s Apex landfill in Las Vegas. Structure of the Environmental Services Industry The oligopolistic US non-hazardous solid-waste services industry is dominated by Waste Management, Republic Services and Waste Connections, which collectively generate over half of industry revenue and control an equal percentage of valuable disposal capacity. Most operators boast strong returns on capital and predictable cash flow streams, buoyed in part by real pricing expansion. The landfill business has significant barriers to entry, while Stericycle’s niche in the medical-waste industry and US Ecology’s monopolistic radioactive waste disposal assets are compelling. We like the structure of the group. We’ve optimized our industrials coverage. Our reports can be found here.

Waste Management’s Dividend Well-Covered with Free Cash Flow

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Image Source: david.dames  By Brian Nelson, CFA We continue to be huge fans of the garbage-collection business. In fact, we cannot remember a time when we didn’t like the waste collection space. The group benefits from a relatively recession-resistant pick-up operation, and transfer and disposal assets that simply demand pricing power. The trash-taking industry is also notorious for its free-cash-flow generating prowess, and we don’t think that will ever change. The latest data point as it relates to the health of the waste industry, and perhaps the general economy as well, came with Waste Management’s (WM) third-quarter results, released October 23. The company’s revenue advanced 3.8% thanks in part to strong all-in organic sales expansion in its collection and disposal … Read more

Valuentum Stock Screeners

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This article was sent to members via email December 29. That email can be accessed at the link that follows this article. By Brian Nelson, CFA Hi everyone, I wanted to provide an update with respect to Valuentum’s stock screeners. We believe our stock screeners are among the most robust when it comes to providing forward-looking data, or data that is important with respect to the investment decision-making process. We publish screens in each of the monthly newsletters, but we also provide a basic weekly screener for download on the left column of the website, “Download Weekly Stock Screener (xls) — login required.”   We also have other products. The more robust DataScreener, for example, is part of the quarterly Financial … Read more

Market Mayhem — Alerts for Members

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During these extremely volatile times, it’s important to stay focused. On December 15, we informed all of our members to “Pay Attention.” Shortly thereafter, we notified members of the potential for a stock market technical breakdown. This morning, we offered a pre-market briefing about the importance of thinking about portfolio protection. For Best Ideas Newsletter and Dividend Growth Newsletter members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=e2406cd6-c113-4344-8731-493f33fc44a4&id=preview For High Yield Dividend Newsletter members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=b3ba530f-38b3-489a-ac96-2961dca89c6b&id=preview For Exclusive members: http://campaign.r20.constantcontact.com/render?preview=true&m=1110817109903&ca=ba6d90c0-4433-48b2-9b8a-aac4ddf9006e&id=preview We’re here for any questions. Please just let us know how we can help! Kind regards, Brian Nelson, CFA  brian@valuentum.com

Economic Data Recap in 3 Minutes

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Image Source: CreditDebitPro via Flickr There’s a lot happening to impact the markets these days. Let’s cover some key economic data, stocks that may see a fundamental boost from Hurricane Florence, and we’ll reiterate our view that trade tantrums between the US and China will likely not amount to much of a negative impact on global economic activity, despite huge headline numbers. By Kris Rosemann Famed investor Peter Lynch has been attributed with the quote, “If you spend more than 13 minutes analyzing economic and market forecasts, you’ve wasted 10 minutes,” so let’s take a quick look at some recent economic data releases and what they might mean for the markets moving forward. Most market observers continue to expect the … Read more

Valuentum’s Weighted Average Cost of Capital (WACC) Distribution

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The weighted average cost of capital is one of the most subjective measures in corporate finance, but it is also one of the most important ones. “The most important item over time in valuation is obviously interest rates…If interest rates are destined to be at low levels…It makes any stream of earnings from investments worth more money. The bogey is always what government bonds yield….Any investment is worth all the cash you’re going to get out between now and judgment day discounted back. The discounting back is affected by whether you choose interests rates like those of Japan or interest rates like those we had in 1982…When we had 15 percent short-term rates in 1982, it was silly to pay … Read more

Study: Valuentum’s Best Ideas Newsletter Portfolio

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To read the study, please click on the image to download the pdf document (pdf).

Waste Industry Collecting Cash

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Pressures in the recycling business didn’t negate revenue growth across the municipal solid waste space during the first quarter of 2018, and the pace of operating-income and free-cash-flow expansion remains solid. Valuations could be more attractive, but dividends look strong, even though we’d like to see lower levels of financial leverage. By Brian Nelson, CFA Waste Management (WM) kicked off first-quarter earnings season for the big three garbage haulers in the municipal waste space April 20. Though recycling revenue faced pressure during the period, Waste Management’s first-quarter results had everything we’d be looking for. Core price advanced 4.9%, and traditional solid waste internal revenue growth from volume was 3%, helping to drive total reported revenue higher by 2.1%. The solid … Read more

ICYMI: Valuentum’s Improved Stock and ETF Web Pages

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Valuentum has rolled out improved stock and ETF web pages on its website valuentum.com/. Now, subscribers can access key proprietary information on the stock and ETF web pages in addition to the customary stock and ETF reports. Dear reader, We have some exciting news that we can’t wait to share with you! At valuentum.com/, we have rolled out new stock and ETF pages that conveniently include a variety of our proprietary metrics from the Dividend Cushion ratio to the Economic Castle rating and beyond! There’s even mouseover functionality so you can learn about how we define the key metrics across our stock-selection and dividend growth methodologies. You’ll still have access to the stock and dividend reports on the landing pages, … Read more