One man’s trash is another man’s treasure. Despite the volatile backdrop for equities, waste management stocks continue to climb on the back of solid fundamental performance.

Fundamental drivers: pricing and M&A

Top-line growth has been positive across the board to varying degrees, as companies acquire other platforms, shed contracts, and divest assets to optimize their portfolios.

Recent revenue growth has been driven by M&A, though pricing power has helped add juice to margins and offset some headwinds from lower volumes.

Bottom-line growth has been more predictable across the basket…

… with margins trending higher. It’s clear some names are focused on margin expansion (GFL) while others are chasing top-line growth (CWST).

Not too crowded, despite strong performance

Despite the strong performance, the waste names are generally trading near their long-term average valuations, with some exceptions like GFL that have transformed their business over that time period.