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    Waste Management (WM) Stock Sits Close To Fair Value On Cash Flow

    Simply Wall St·10/25/2026 02:34:59
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    Waste Management has delivered steady share gains in recent years, which puts a spotlight on whether the current valuation is still backed by the cash the business can generate. With the stock now trading at US$239.38, the central issue is how that price lines up against the cash flows implied by a Discounted Cash Flow (DCF) view.

    • Over the past 5 years the stock has returned 61.7%, which makes it important to test whether that climb is matched by the underlying cash flow profile.
    • The recent federal lawsuit over alleged landfill violations in Texas may affect future compliance costs and the timing of cash flows if remediation or closure requirements expand.
    • If you'd rather focus on earnings, this one's for you. See why Waste Management's 33.5x P/E tells a different valuation story.

    The stock's next move may depend on whether Waste Management's current share price is fully supported by the cash flows implied by a Discounted Cash Flow (DCF) estimate.

    If you want a second reference point alongside Waste Management's DCF story, a focused screen of 29 high quality undervalued stocks.

    Is Waste Management Fairly Priced on Cash Flow?

    The Discounted Cash Flow (DCF) model here uses a 2 stage Free Cash Flow to Equity approach based on projected cash the business can return to shareholders. Waste Management generated about $3.1b of free cash flow over the last twelve months, and the forecast path points to free cash flow staying in the multi billion dollar range over the coming decade rather than swinging sharply.

    Analyst inputs in the DCF assume growing cash flows into 2030 that then level off into more modest, steady increases, which is typical for a mature operator rather than a high growth story. With the stock trading at $239.38, those projections translate into an estimated intrinsic value that sits broadly in line with where the market is pricing Waste Management today. The recent Harris County lawsuit over alleged landfill violations helps explain why investors may be cautious, even when the cash flow projections look relatively stable. Find out what Waste Management could be worth using our Discounted Cash Flow (DCF) estimate.

    The Waste Management Narrative: What Would Justify Today's Price?

    Simply Wall St Narratives pick up where the DCF puzzle for Waste Management leaves off. They spell out which paths for future growth, margins and earnings would need to play out for the stock to be worth materially more or less than today’s price on the Community page. Instead of one headline figure from a ratio or model, you see the underlying storyline those numbers rely on so you can watch how closely real outcomes track that implied future.

    One of the top community narratives on Waste Management: 6% undervalued

    "The main thing that has to go right is that Waste Management turns its large investments in healthcare solutions, recycling automation and renewable natural gas into sustained cross sell…"

    Discover why this Narrative puts Waste Management at 6% undervalued.

    One more angle on Waste Management that could shift how you see the stock

    Cash flow and lawsuits tell only part of the story at Waste Management. The people setting priorities, and the way their rewards are structured, can tilt long term outcomes in very different directions. See who runs Waste Management and how they are paid.