Wedbush Raised Price Target on Waste Management (WM) to $60 as EPS Beat was Offset by Expenses

Wedbush maintained an Outperform rating on Waste Management (NYSE: WM), and raised the price target to $60.00 (from $58.00), following the company's 4Q earnings report. 4Q EPS beat consensus estimate by $0.01 on better-than-expected operating margin, partially offset by select non-operating expenses. 4Q net revenue was short but mix, route optimization and lower fuel surcharges drove 50bps gross margin beat.

Analyst Al Kaschalk commented, "4Q adjusted EPS tops our estimate; CY16 outlook in-line with expectations. We are currently reaffirming our OUTPERFORM stance on shares of Waste Management (WM) following the solid 4Q adjusted EBITDA margin that topped our estimate by 10bps, benefiting from lower fuel surcharges (revenue) and lower fuel expense. 4Q EPS beat consensus and topped our estimate by $0.01 on betterthan-expected operating margin partially offset by select non-operating expenses. CY16 EPS guidance brackets consensus, while operating outlook implies a betterthan-expected pricing environment and improving, and not positive volume backdrop in 2H:CY16. With the Board increasing the dividend 6% and $650 million targeted for share repurchase, management guided CY16 FCF up to $1.45-1.50 billion before proceeds from targeted asset divestitures."

For an analyst ratings summary and ratings history on Waste Management click here. For more ratings news on Waste Management click here.

Shares of Waste Management closed at $55.50 yesterday.

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