3. Waste Connections, Inc. (NYSE:WCN)
5-year Beta (monthly): 0.72
Number of Hedge Fund Holders: 50
Waste Connections, Inc. (NYSE:WCN) is an integrated waste services provider in North America that specializes in waste collection, transfer, disposal, and recycling, primarily focusing on solid waste management. The company operates with a diverse portfolio of products and services tailored to meet the needs of residential, commercial, and industrial clients.
Its offerings include various dumpster rental sizes, waste management solutions for construction sites, and dedicated recycling programs aimed at promoting environmental responsibility. Over the years, the company has made strategic acquisitions to improve its services and geographic reach and has positioned itself as one of the largest players in the waste management industry in North America. It is one of the best low beta stocks to buy.
Waste Connections (NYSE:WCN) runs 71 recycling facilities dedicated to processing materials from consumers and assisting clients in achieving their diversion targets. In the year 2021, it managed the recycling of about 2 million tons of various materials, including fiber, metals, and plastics. Furthermore, it has implemented roughly 50 recycling robots in its operations and has positioned itself as an industry pioneer in automation.
In Q2, 50 hedge funds had positions worth over $1.5 billion in the company. As of June 30, Bill & Melinda Gates Foundation Trust is its biggest shareholder with 2.15 million shares, worth $376.879 million.
Waste Connections (NYSE:WCN) also returns a healthy amount to its shareholders through dividends and buybacks. While the company’s dividend yield of 0.64% is low compared to its sector, it has been raising its dividend for the last 7 years.
In addition, on August 8, the company announced that it had received approval from the Toronto Stock Exchange (TSX) to renew its normal course issuer bid (NCIB) following the expiration of the current NCIB on August 9, 2024. The renewed NCIB allows the company to buy back up to 12,901,981 common shares, representing 5% of its outstanding shares as of August 1, 2024.
Daily purchases on the TSX will be limited to 60,089 shares, or 25% of the average daily trading volume, with similar rules applying to the New York Stock Exchange (NYSE). The buyback program is authorized from August 12, 2024, to August 11, 2025.
TimesSquare Capital Management stated the following regarding Waste Connections, Inc. (NYSE:WCN) in its first quarter 2024 investor letter:
“Many of our Industrials positions provide necessary business-to-business operational services, highly technical components, automation & efficiency improvements, or essential infrastructure services. Adding value to the strategy was Waste Connections, Inc. (NYSE:WCN), which collects, transfers, recycles, and disposes of waste for municipalities and businesses in the U.S. and Canada. Revenues and earnings topped expectations, as did management’s initial guidance for 2024. The company projects near-term growth in volumes and pricing, which recent acquisitions should make more than likely. As Waste Connection’s shares climbed 15%, we trimmed our holdings.”
