Waste Connections (WCN) has come into Q1 2026 on the back of a busy 2025, with Q4 revenue at US$2.4 billion and basic EPS of US$1.01, alongside trailing 12 month revenue of US$9.5 billion and EPS of US$4.18, all against a backdrop of 74.3% earnings growth over the last year. Over recent quarters, the company has seen revenue move from US$2.3 billion in Q3 2025 to US$2.4 billion in Q4 2025, while quarterly basic EPS shifted from US$1.11 to US$1.01, with the latest trailing net margin at 11.4% compared with 6.9% a year earlier. In the context of forecasts for ongoing earnings growth and a higher margin profile, these results put profitability and efficiency firmly in focus for investors looking at the new earnings print.

See our full analysis for Waste Connections.

With the latest numbers on the table, the next step is to see how this earnings profile lines up with the prevailing narratives around Waste Connections, and where the data starts to challenge the usual story investors tell about the stock.

Margins Step Up To 11.4%

• Trailing 12 month net income of US$1.1b on US$9.5b of revenue gives an 11.4% net margin, compared with 6.9% a year earlier according to the analysis data.
• What stands out for the bullish view is that this higher margin sits alongside 74.3% earnings growth over the last year and an earnings growth forecast of about 10.25% a year, which supports the idea that pricing and acquisition benefits are flowing through to the bottom line.
  • Consensus narrative points to effective pricing and acquisition activity as key drivers, and the move from a 6.9% to 11.4% margin lines up with that focus on better profitability.
  • Comments about improved retention, safety and cost control also fit with trailing net income of US$1.1b, which is materially higher than the US$617.6m level in the prior year period shown in the data.

Stronger margins and earnings growth are exactly what bullish investors look for when they argue that this story still has room to run. It can be useful to see how that case is built out in more detail in the dedicated bull narrative 🐂 Waste Connections Bull Case

Rich 39.9x P/E With Debt In The Mix

• The trailing P/E multiple of 39.9x for Waste Connections compares with 23.3x for the industry and 35.2x for peers, while the business also carries a high level of debt according to the risk summary.
• Bears focus on this combination of a premium P/E and high leverage, arguing that it creates pressure on how much investors may be willing to pay even with solid earnings growth.
  • The 39.9x P/E sits well above the 23.3x industry level in the data, so skeptics point to a valuation premium that is already in place before any new growth is delivered.
  • With leverage flagged as high in the risks summary, critics also highlight that any change in financing costs or acquisition pace would matter more than for a low debt peer, given the premium multiple already shown.

If you want to see how cautious investors build their case around that higher P/E and debt profile, the detailed bear narrative sets out those arguments 🐻 Waste Connections Bear Case

DCF Gap Versus US$198.40 Target

• The stock trades at US$168.89 compared with a DCF fair value of about US$230.20 and an analyst price target of US$198.40, so the current price sits below both reference points in the supplied data.
• Consensus narrative frames this as a tension between attractive modelled value support and rich multiples, with investors weighing 74.3% trailing earnings growth and a forecast 10.25% annual earnings growth rate against a 39.9x P/E that is higher than industry and peer averages.
  • The gap between US$168.89 and the DCF fair value of roughly US$230.20 suggests upside in that model, while the difference between the share price and the US$198.40 analyst target is smaller but still present.
  • At the same time, the high debt level in the risk summary sits alongside these valuation references, so some investors may see the discount to DCF and analyst target as balanced by higher financial risk and a premium P/E.

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.

Given this mix of optimism and caution, it helps to move quickly from headline impressions to your own view by examining the full set of risks and rewards. To balance the 1 or more concerns with the 1 or more positives investors see, take a closer look at the 3 key rewards and 1 important warning sign

See What Else Is Out There

The combination of a rich 39.9x P/E, high leverage and a premium valuation compared with industry peers leaves little room for comfort if conditions change.

If that premium and debt profile makes you uneasy, it is worth quickly checking the 74 resilient stocks with low risk scores to find companies where balance sheet strength and risk controls are front and center.

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.