Waste Connections (WCN) has wrapped up FY 2025 with Q4 revenue of US$2.4b and basic EPS of US$1.01, while trailing 12 month figures show revenue of US$9.5b and EPS of US$4.18. Over recent quarters the company has seen revenue move from US$2.23b in Q1 2025 to US$2.41b in Q2, US$2.46b in Q3 and US$2.37b in Q4. Quarterly EPS ranged from US$0.94 to US$1.12 over the same period. With trailing net margin sitting at 11.4% versus 6.9% a year earlier, this set of results places profitability and the quality of those margins firmly in focus for investors assessing the latest numbers.

See our full analysis for Waste Connections.

With the headline figures on the table, the next step is to compare these results with the key narratives around Waste Connections, highlighting where the numbers align with the prevailing stories and where they begin to challenge them.

Margins Build On 74.3% Earnings Growth

• Over the last 12 months, Waste Connections generated about US$9.5b in revenue and US$1.1b in net income, with the trailing net margin at 11.4% compared with 6.9% a year earlier.
• Analysts' consensus view links this higher 11.4% margin to effective pricing and cost control. At the same time, they flag risks around weather and commodity driven revenue, noting that severe storms or shifts in recycling prices could pressure those margins if volumes or recycling income are affected again.

Valuation Sits Between DCF And 203.58 Target

• The current share price of US$157.58 is shown below a DCF fair value of about US$196.55, while a separate analyst price target of roughly US$203.58 implies additional upside from the same starting price.
• Bullish investors highlight that this pricing comes with trailing earnings growth of 74.3% and a P/E of 37.4x versus 25.1x for the broader US Commercial Services group and about 36.2x for peers. They argue that this supports the case that the market is already paying up for the recent margin and earnings strength even though the stock still sits below both the DCF fair value and the US$203.58 target.

Analysts who focus on the gap between US$157.58 and US$203.58 argue there may still be room for the bullish thesis if margins stay closer to 11.4% than the prior 6.9%. They also note that a 37.4x P/E leaves less room for disappointment in future results. 🐂 Waste Connections Bull Case

High Debt And Acquisition Reliance

• Alongside the stronger trailing figures, the company is flagged as having a high level of debt, and recent quarterly net income has ranged from US$241.5 million in Q1 2025 to US$290.3 million in Q2 and then US$258.5 million in Q4. This means interest costs and financing conditions matter a lot for how much of that US$9.5b in revenue turns into profit.
• Bears focus on that leverage and the heavy use of acquisitions, arguing that a growth model leaning on deal activity and some commodity linked revenue could run into trouble if integration is harder than expected or if financing costs rise. The quarterly pattern of net income between US$241.5 million and US$290.3 million gives them concrete earnings levels to watch against those concerns.

Skeptics who are wary of the higher P/E and the debt load often stress that a business relying heavily on acquisitions and some commodity sensitive recycling income needs those earnings to stay close to the trailing US$1.1b level for the current valuation to remain comfortable in their eyes. 🐻 Waste Connections Bear Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Waste Connections on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

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A great starting point for your Waste Connections research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

See What Else Is Out There

For all the strong margins, Waste Connections still carries high debt, relies heavily on acquisitions and trades on a P/E that leaves limited room for earnings setbacks.

If that mix of leverage and acquisition risk feels a bit tight for your comfort, you could balance your research with 85 resilient stocks with low risk scores that prioritise more resilient profiles and steadier financial footing.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.