Traders Purchase High Volume of Waste Management Call Options (NYSE:WM)

Key Points

• Waste Management call-option activity surged: Investors purchased 3,004 call options, about 50% above the average volume of 2,000 contracts.
• Analyst sentiment remains positive: Several firms raised their price targets, contributing to a consensus “Moderate Buy” rating and an average target of $258.89.
• Recent operating results and shareholder returns were solid: Waste Management beat quarterly EPS estimates, reported 4% year-over-year revenue growth, and declared a $0.945 quarterly dividend, equal to a 1.8% yield.

Waste Management, Inc. (NYSE:WM - Get Free Report) saw unusually large options trading on Friday. Investors purchased 3,004 call options on the stock. This is an increase of approximately 50% compared to the average volume of 2,000 call options.

Analysts Set New Price Targets

Several brokerages have weighed in on WM. Weiss Ratings raised Waste Management from a "buy (b-)" rating to a "buy (b)" rating in a report on Wednesday. Stifel Nicolaus upped their price target on shares of Waste Management from $252.00 to $261.00 and gave the company a "buy" rating in a report on Thursday, July 30th. Barclays lifted their price objective on Waste Management from $270.00 to $277.00 and gave the company an "overweight" rating in a research note on Thursday, July 30th. UBS Group boosted their price target on Waste Management from $265.00 to $270.00 and gave the company a "buy" rating in a report on Tuesday, August 4th. Finally, Wolfe Research started coverage on Waste Management in a research report on Tuesday. They issued a "peer perform" rating for the company. Thirteen research analysts have rated the stock with a Buy rating and six have issued a Hold rating to the stock. Based on data from MarketBeat, Waste Management has a consensus rating of "Moderate Buy" and an average price target of $258.89.

Waste Management Stock Performance

NYSE:WM traded down $1.62 during mid-day trading on Friday, reaching $211.71. The stock had a trading volume of 539,098 shares, compared to its average volume of 2,154,463. Waste Management has a twelve month low of $194.11 and a twelve month high of $248.13. The business has a 50 day simple moving average of $226.10 and a 200 day simple moving average of $226.06. The firm has a market capitalization of $84.62 billion, a price-to-earnings ratio of 29.99, a PEG ratio of 2.70 and a beta of 0.42. The company has a debt-to-equity ratio of 2.24, a quick ratio of 0.87 and a current ratio of 0.91.

Waste Management (NYSE:WM - Get Free Report) last released its earnings results on Tuesday, July 28th. The business services provider reported $2.02 EPS for the quarter, beating analysts' consensus estimates of $1.98 by $0.04. Waste Management had a return on equity of 31.68% and a net margin of 11.11%.The company had revenue of $6.68 billion during the quarter, compared to the consensus estimate of $6.71 billion. During the same quarter last year, the company earned $1.92 earnings per share. Waste Management's quarterly revenue was up 4.0% compared to the same quarter last year. On average, analysts expect that Waste Management will post 8.13 earnings per share for the current fiscal year.

Waste Management Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Friday, September 25th. Shareholders of record on Friday, September 11th will be issued a $0.945 dividend. This represents a $3.78 annualized dividend and a dividend yield of 1.8%. The ex-dividend date is Friday, September 11th. Waste Management's dividend payout ratio (DPR) is presently 53.54%.

Insiders Place Their Bets

In related news, CAO John Carroll sold 1,365 shares of the business's stock in a transaction that occurred on Friday, September 4th. The shares were sold at an average price of $219.90, for a total value of $300,163.50. Following the completion of the transaction, the chief accounting officer owned 3,509 shares of the company's stock, valued at $771,629.10. The trade was a 28.01% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at the SEC website. 0.18% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Waste Management

Several hedge funds have recently made changes to their positions in the company. BlackRock Inc. lifted its stake in Waste Management by 1.8% during the second quarter. BlackRock Inc. now owns 30,733,944 shares of the business services provider's stock worth $6,849,981,000 after purchasing an additional 535,079 shares during the period. State Street Corp boosted its position in shares of Waste Management by 1.6% in the 4th quarter. State Street Corp now owns 17,390,748 shares of the business services provider's stock worth $3,820,921,000 after purchasing an additional 281,456 shares during the last quarter. Geode Capital Management LLC grew its stake in shares of Waste Management by 1.3% during the fourth quarter. Geode Capital Management LLC now owns 8,993,006 shares of the business services provider's stock worth $1,972,371,000 after purchasing an additional 117,476 shares during the period. Norges Bank bought a new stake in Waste Management in the fourth quarter valued at about $1,022,916,000. Finally, UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC increased its holdings in Waste Management by 1.1% in the second quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 3,121,427 shares of the business services provider's stock valued at $695,704,000 after purchasing an additional 35,322 shares during the last quarter. Hedge funds and other institutional investors own 80.40% of the company's stock.

About Waste Management

WM, Inc, formerly known as Waste Management, Inc, is an environmental services company that provides waste collection, transfer, disposal and recycling services. The company serves residential, commercial, industrial and municipal customers, helping manage everyday refuse as well as certain specialized waste streams.

Its operations include curbside and commercial waste collection, transfer stations, recycling facilities, landfills and waste-related energy services. WM also develops renewable natural gas and electricity projects that capture landfill gas for use as an energy source.

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