Waste Connections (WCN) Marginally Dips Despite Q2 Earnings Beat

Core Insights - Waste Connections, Inc. (WCN) reported strong second-quarter 2024 results with earnings and revenues exceeding Zacks Consensus Estimates [1][2] - Despite better-than-expected earnings, WCN stock experienced a slight decline post-results announcement [1] Financial Performance - Adjusted earnings of $1.2 per share beat the Zacks Consensus Estimate by 5.1% and increased 21.6% year-over-year [2] - Revenues reached $2.2 billion, surpassing the consensus estimate by 1.4% and rising 11.2% from the previous year [2] - WCN shares have appreciated 27.1% over the past year, outperforming the industry’s 23.9% increase and the Zacks S&P 500 Composite's 23% rise [2] Segmental Revenues - Solid Waste Collection segment revenues grew 6.6% year-over-year to $1.6 billion, meeting estimates [3] - Solid Waste Disposal and Transfer segment revenues increased 9.7% to $756.1 million, exceeding estimates of $434.2 million [3] - Solid Waste Recycling segment revenues surged 65.1% to $63.3 million, surpassing estimates of $43.5 million [4] - Intermodal and Other segment revenues rose 24.4% to $49.1 million, beating estimates of $34.9 million [4] - E&P Waste Treatment, Recovery, and Disposal segment revenues more than doubled to $123.6 million, exceeding estimates of $60.9 million [4] Operating Results - Adjusted EBITDA for the quarter was $731.8 million, up 16.4% year-over-year, with an adjusted EBITDA margin of 32.6%, an increase of 150 basis points [5] - Operating income was $424.7 million, higher than the previous year's $344.1 million [5] Balance Sheet & Cash Flow - At the end of Q2 2024, cash and cash equivalents were $78.7 million, slightly up from $78.4 million in the previous quarter [6] - Long-term debt remained stable at $6.7 billion [6] - Cash generated from operating activities was $574.4 million, with adjusted free cash flow of $402.6 million [6] - Capital expenditures totaled $218.4 million, and dividends paid amounted to $65.3 million [6] Updated 2024 Outlook - For 2024, Waste Connections expects revenues of $8.85 billion, slightly above the Zacks Consensus Estimate of $8.84 billion [7] - Projected adjusted EBITDA and margin for 2024 are $2.90 billion and 32.8%, respectively [7]