10 Best Recycling Stocks to Buy According to Hedge Funds

1. Waste Connections, Inc. (NYSE:WCN)

Market cap as of November 7: $46.34 Billion

Number of Hedge Fund Holders: 50

Waste Connections, Inc. (NYSE:WCN) is a waste management company that provides nonhazardous waste collection, transfer, disposal, and resource recovery services. It owns and operates transfer stations that receive, compact and/or load waste to be transported to landfills or treatment facilities.

The company’s competitive edge, which has strengthened its prospects in the solid waste and recycling services sectors, stems from its aggressive merger and acquisition (M&A) strategy, which has earned it a solid reputation. Consequently, it’s been able to diversify its service offerings and increase its market presence. With more acquisitions anticipated to close later this year, the company has acquired companies with annualized revenues of about $500 million.

Thanks to the aggressive merger and acquisition strategy, Waste Connections, Inc. (NYSE:WCN) delivered solid third-quarter results on October 28, 2024, with net income increasing 34.5%  yearly to $308 million. For the nine months of the year, the company has registered a 27.9% increase in net income to $813.6 million. Waste Connections is well positioned for another increase in its full-year earnings owing to solid waste operations pricing and growth, which affirms why it is one of the best recycling stocks to buy.

Management expects innovative approaches to continue driving employee engagement and retention improvements, leading to above-average underlying margin expansion in solid waste collection and increased shareholder value. While trading at a price-to-earnings multiple of 23 slightly lower than the Industrials sector average P/E of 27, Waste Connections, Inc. (NYSE:WCN), rewards investors with a 0.71% dividend yield.

While we acknowledge the potential of WCN as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than WCN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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