Waste Connections (WCN) Stock Forecast & Price Target

Waste Connections has demonstrated a positive financial trajectory, highlighted by a year-over-year Adj.EBITDA margin increase of 12 basis points and continued improvements in voluntary turnover. The solid waste core pricing remained resilient at 6.6% while same-store margin expansion outpaced headwinds from recycled commodities, indicating effective operational strategies. Additionally, the company is poised for further profitability growth, with guidance suggesting a 60 basis point improvement in margins for the second half of 2025, reinforcing a strong outlook for the firm’s financial performance.

Waste Connections is facing challenges as indicated by a projected decline in solid waste volumes, expected to be approximately 0.5% worse than previously anticipated, contributing to overall revenue pressures. The firm reported a significant drop in recycled commodity prices, with declines averaging around 30% year-over-year, which presents further headwinds of $25 million and $5 million in the second half of the year. Additionally, despite a slight improvement in voluntary turnover rates, the company's volume growth remains negative, recording a 2.6% decrease, primarily due to macroeconomic uncertainties and a strategic reduction of low-quality waste volumes.