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  5. WCN: What are your thoughts on WCN's current valuation? [Waste Connections Inc.]
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Q: What are your thoughts on WCN's current valuation? Seems like a good entry point?

Thanks
Asked by Keith on August 27, 2025
5i Research Answer:

WCN is up 2.7% year-to-date, and about flat on a one-year basis. Forward sales estimates are in the mid to high-single digit range, while its earnings are expected to grow in the low double-digit range. Sales growth has historically been fairly strong and consistent, but its earnings have been declining over the past few years. But, cash flow continues to grow, and it pays out a dividend and is building up its balance sheet. Its net debt/EBITDA is somewhat high at 3.4X. Its valuation is fairly high at 34X forward earnings, but it has held a premium valuation for a while now, and this reflects the industry it operates in. For a long-term holding, we would be comfortable adding here, but we might not expect much in the way of near-term returns given its fairly flat momentum.