Head-To-Head Survey: Waste Management (WM) vs. Clean Harbors (CLH)

Waste Management (NYSE: WM) and Clean Harbors (NYSE:CLH) are both mid-cap business services companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, analyst recommendations and dividends.

Institutional and Insider Ownership

75.5% of Waste Management shares are owned by institutional investors. Comparatively, 95.1% of Clean Harbors shares are owned by institutional investors. 0.2% of Waste Management shares are owned by insiders. Comparatively, 9.5% of Clean Harbors shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Waste Management and Clean Harbors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Waste Management 9.18% 25.07% 6.56%
Clean Harbors -0.65% 0.79% 0.23%

Analyst Recommendations

This is a summary of current recommendations and price targets for Waste Management and Clean Harbors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Waste Management 1 3 6 0 2.50
Clean Harbors 0 4 7 0 2.64

Waste Management currently has a consensus price target of $75.00, suggesting a potential downside of 0.33%. Clean Harbors has a consensus price target of $60.90, suggesting a potential upside of 21.19%. Given Clean Harbors’ stronger consensus rating and higher possible upside, analysts clearly believe Clean Harbors is more favorable than Waste Management.

Valuation and Earnings

This table compares Waste Management and Clean Harbors’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Waste Management $14.13 billion 2.34 $3.86 billion $2.91 25.86
Clean Harbors $2.86 billion 1.00 $415.29 million ($0.32) -157.03

Waste Management has higher revenue and earnings than Clean Harbors. Clean Harbors is trading at a lower price-to-earnings ratio than Waste Management, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Waste Management has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, Clean Harbors has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500.

Dividends

Waste Management pays an annual dividend of $1.70 per share and has a dividend yield of 2.3%. Clean Harbors does not pay a dividend. Waste Management pays out 58.4% of its earnings in the form of a dividend. Clean Harbors has increased its dividend for 13 consecutive years.

Summary

Clean Harbors beats Waste Management on 9 of the 17 factors compared between the two stocks.

Waste Management Company Profile

Waste Management, Inc. (WM) is a holding company. The Company, through its subsidiaries, is a provider of waste management environmental services. The Company’s segments include Solid Waste and Other. The Company’s Solid Waste segment includes its solid waste business. The Other segment includes its Strategic Business Solutions (WMSBS) organization; its landfill gas-to-energy operations and third-party subcontract and administration services managed by its Energy and Environmental Services and WM Renewable Energy organizations; its recycling brokerage services, and its service offerings and solutions, such as portable self-storage and long distance moving services, fluorescent lamp recycling and interests it holds in oil and gas producing properties. As of December 31, 2016, the Company owned or operated 243 solid waste landfills and five secure hazardous waste landfills. Its recycling brokerage services involve managing the marketing of recyclable materials for third parties.

Clean Harbors Company Profile

Clean Harbors, Inc. is a provider of environmental, energy and industrial services throughout North America. The Company is also a re-refiner and recycler of used oil in the world and a provider of parts cleaning and related environmental services to commercial, industrial and automotive customers in North America. The Company operates in six segments: Technical Services, Industrial Services, Field Services, Safety-Kleen, Oil and Gas Field Services, and Lodging Services. The Company is also a service provider in the recovery and decontamination of pollutants. The Company provides services to protect the ozone layer from the effects of chlorofluorocarbons (CFCs). It offers brands, such as Performance Plus brand and green brand EcoPower. The Company also offers CleanPack services, which include the collection, identification and categorization, packaging, transportation and disposal of laboratory chemicals and household hazardous waste. It also provides hydro excavation services.

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