Is it a good company at a reasonable price? This company has done well for its shareholders in the past. Analysts do expect growth this year also. Dividend is low, but the growth is moderate. A number of analysts seem to think that the stock is undervalued. My testing is showing that the stock price is reasonable for the tests that I like, but some testing is showing the stock as cheap and some as expensive.
I do not own this stock of Waste Connections Inc. (TSX-WCN, NYSE-WCN), but I used to. I first bought this stock in 2007 because TD Securities had a very favorable report on this stock and had it on their action buy list. I had money because I had recently sold RIM. At that time, it was BFI Canada Income Fund. In 2010, I needed to buy something for Pension Account. I have this already and it is on TD Action Buy List. I sold because it became the target of a reverse takeover by an American company.
Dividend is low, but the growth is moderate. What does this mean for the future? If the dividend increases remain at 12.90% then the dividends paid, the Dividend yield and the Dividend Coverage of the current stock price in 5, 10 and 15 years would as shown below. This is in US$ as dividends are paid in US$.
| Div Pd | Div Yield | Years | At IRR | Div Cov |
|---|---|---|---|---|
| $2.39 | 1.41% | 5 | 10.87% | 5.26% |
| $4.06 | 2.36% | 10 | 10.87% | 12.80% |
| $6.93 | 3.95% | 15 | 10.87% | 25.64% |
When I was updating my spreadsheet, I noticed that this stock has continued to do well. See the chart below. In the chart below, I am showing 5 and 10 year total growth and per year growth in columns 3 and 4. Column 5 shows growth expected over 12 months to the first quarter in 2026 and expected growth over this year. This chart is in US$. The financial are in US$. Dividends are paid in US$.
| Yr | Item | Tot. Growth | Per Year | Gwth | Coverage |
|---|---|---|---|---|---|
| 5 | Revenue Growth | 73.83% | 11.69% | 1.50% | <-12 mths |
| 5 | AEPS Growth | 95.08% | 14.30% | 1.94% | <-12 mths |
| 5 | Net Income Growth | 425.98% | 39.38% | -2.06% | <-12 mths |
| 5 | Cash Flow Growth | 71.39% | 11.38% | 0.17% | <-12 mths |
| 5 | Dividend Growth | 70.39% | 11.25% | 8.11% | <-12 mths |
| 5 | Stock Price Growth | 70.97% | 11.32% | -5.08% | <-12 mths |
| 10 | Revenue Growth | 391.64% | 17.26% | 5.62% | <-this year |
| 10 | AEPS Growth | 160.10% | 10.03% | 6.80% | <-this year |
| 10 | Net Income Growth | 769.06% | 24.14% | 9.52% | <-this year |
| 10 | Cash Flow Growth | 481.68% | 19.25% | 11.12% | <-this year |
| 10 | Dividend Growth | 307.56% | 15.08% | 7.64% | <-this year |
| 10 | Stock Price Growth | 437.82% | 18.32% | 16.29% | <-this year |
If you had invested in this company in December 2015, for $1,038.12 you would have bought 23 shares at $45.14 per share. In December 2025, after 10 years you would have received $255.92 in dividends. The stock would be worth $5,536.56. Your total return would have been $5,792.48. This would be a total return of 19.33% per year with 18.22% from capital gain and 1.11% from dividends. This chart is in CDN$.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $45.14 | $1,038.12 | 23 | 10 | $255.92 | $5,536.56 | $5,792.48 |
The current dividend yield is low with dividend growth moderate. The current dividend yield is low (below 2%) at 0.84%. The 5, 10 and historical median dividend yield is also low at 0.71%, 0.77% and 1.10%. The dividend growth is moderate (8% to 14% per year) at 11% per year over the past 5 years. The last dividend increase was in 2025 and it was for 11%.
The Dividend Payout Ratios (DPR) are good. The DPR for 2025 for Earnings per Share (EPS) is good at 31% with 5 year coverage at 35%. The DPR for 2025 for Adjusted Earnings per Share (AEPS) is good at 25% with 5 year coverage at 25%. The DPR for 2025 for Cash Flow per Share (CFPS) is good at 12% with 5 year coverage at 13%. The DPR for 2025 for Free Cash Flow (FCF) is good at 23% with 5 year coverage at 23%. FCF for 2025 ranges from $1,218M to $1,480M. I am using the $1,480M value. This chart is in US$.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 31.06% | 35.11% |
| AEPS | 25.15% | 25.05% |
| CFPS | 12.36% | 12.58% |
| FCF | 22.55% | 22.79% |
Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2025 is good at 0.20 and currently at 0.21. The Liquidity Ratio for 2025 is far too low at 0.62 and 0.65 currently. If you added in Cash Flow after dividends, the ratios are fine at 1.60 and currently at 1.84. The Debt Ratio for 2025 is good at 1.64 and 1.61 currently. The Leverage and Debt/Equity Ratios for 2025 are fine at 2.56 and 1.56 and currently at 2.63 and 1.63. This chart is in US$.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.20 | 0.21 |
| Intang/GW | 0.23 | 0.23 |
| Liquidity | 0.62 | 0.69 |
| Liq. + CF | 1.60 | 1.84 |
| Debt Ratio | 1.64 | 1.61 |
| Leverage | 2.56 | 2.63 |
| D/E Ratio | 1.56 | 1.63 |
The Total Return per year is shown below for years of 5 to 24 to the end of 2025 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2020 | 5 | 12.90% | 13.87% | 13.02% | 0.85% |
| 2015 | 10 | 14.97% | 19.33% | 18.22% | 1.11% |
| 2010 | 15 | 11.79% | 14.95% | 14.05% | 0.90% |
| 2005 | 20 | 2.45% | 10.57% | 9.54% | 1.03% |
| 2001 | 24 | 5.25% | 14.89% | 12.64% | 2.26% |
The Total Return per year is shown below for years of 5 to 24 to the end of 2025 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2020 | 5 | 11.25% | 12.15% | 11.32% | 0.83% |
| 2015 | 10 | 15.08% | 19.48% | 18.32% | 1.16% |
| 2010 | 15 | 9.45% | 12.47% | 11.64% | 0.84% |
| 2005 | 20 | 1.63% | 9.77% | 8.68% | 1.09% |
| 2001 | 24 | 5.91% | 18.38% | 14.59% | 3.78% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 41.33, 46.88 and 50.60. The corresponding 10 year ratios are 39.47, 42.95 and 48.59. The corresponding historical ratios are 25.13, 29.60 and 34.08. The current ratio is 35.90 based on a stock price of $166.45 and EPS of $4.64. The current ratio is below the low ratio for the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get a similar result in CDN$.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 30.63, 35.46 and 38.83. The corresponding 10 year ratios are 28.71, 32.03 and 36.85. The corresponding historical ratios are 23.62, 27.68 and 34.90. The current ratio is 30.26 based on a stock price of $166.45 and AEPS of $5.50. The current ratio is between the low and median ratios of the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
I get a Graham Price of $88.69. The 10-year low, median, and high median Price/Graham Price Ratios are 2.20, 2.51 and 2.77. The current ratio is 2.67 based on a stock price of $236.88. The current ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in CDN$.
I get a 10-year median Price/Book Value per Share Ratio of 3.80. The current ratio is 5.25 based on a Book Value of $8058M, Book Value per Share of $31.69 and a stock price of $166.45. The current ratio is 38% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will get a similar result in CDN$.
I get a 10-year median Price/Cash Flow per Share Ratio of 15.60. The current ratio is 15.78 based on Cash Flow per Share estimate for 2026 of $10.55, Cash Flow of $2,682M and a stock price of $166.45. The current ratio is 1% above the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$. In CDN$ the results is the current ratio is 4% below the 10 year median ratio and this stock price testing suggests that the stock price is relatively reasonable and below the median. They are not far apart.
I get an historical median dividend yield of 1.10%. The current dividend yield is 0.84% based on dividends of $1.40 and a stock price of $166.45. The current dividend yield is 24% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will get a similar result in CDN$.
I get a 10 year median dividend yield of 0.77%. The current dividend yield is 0.84% based on dividends of $1.40 and a stock price of $166.45. The current dividend yield is 9% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
The 10-year median Price/Sales (Revenue) Ratio is 4.29. The current ratio is 4.23 based on Revenue estimate for 2026 of $9,999M, Revenue per Share of $39.33 and a stock price of $166.45. The current ratio is 1% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you will get a similar result in CDN$.
Results of stock price testing is that the stock price is probably reasonable. The 10 year median dividend yield test says this and it is confirmed by the P/S Ratio test. However, my testing of the stock price ranges from cheap to expensive. Most of the testing is in US$ as this company reports in US$ and dividends are paid in US$.
When I look at analysts’ recommendations, I find Strong Buy (18), Buy (6) and Hold (4). The consensus would be a Strong Buy. The 12 month consensus stock price is $288.79 ($203.92 US$) with a high of $431.94 ($305.00 US$) and low of $220.93 ($156.00 US$.) The consensus stock price of $288.79 implies a total return of 73.49% with 72.65% from capital gains and 0.84% from dividends based on a current stock price of $236.88.
The analysts on Stock Chase vary from Hold, Wait and Buy. The Wait was the recommendation because the analyst thought the stock was overpriced. Rajiv Nanjapla on Motley Fool thinks this stock is currently undervalued. Adam Othman on Motley Fool says it is a good time to buy this stock for potential capital appreciation. The company put out a Press Release about their fourth quarter of 2025. The company put out a press release via Business Wire about their first quarter of 2026.
Zacks via Yahoo Finance says that investor should hold this stock in their portfolios now. Global Newswire via Yahoo Finance talks about the company opening a Renewable Gas Facility. Simply Wall Street via Yahoo Finance reviews this stock in June 2026 and talks about recent mixed returns. It also thinks the stock is undervalued. They have one warning out of has a high level of debt.
Waste Connections is a North American waste management company focused on integrated waste collection services. Revenue is split among six operating segments: Western, Southern, Eastern, Central, Canada, and Midsouth. Its web site is here Waste Connections Inc.
The last stock I wrote about was about was Lassonde Industries Inc (TSX-LAS.A, OTC-LSDAF) ... learn more. The next stock I will write about will be Computer Modelling Group Ltd (TSX-CMG, OTC-CMDXF) ... learn more on Friday, July 3, 2026 around 5 pm. Tomorrow on my other blog I will write about Something to Buy July 2026 learn more on Thursday, July 2, 2026 around 5 pm.
This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
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