Waste Management's Q4 2024: Key Contradictions in Stericycle's EBITDA, Recycling Pricing, and Volume Outlook

These are the key contradictions discussed in Waste Management's latest 2024Q4 earnings call, specifically including: Stericycle EBITDA expectations, recycling pricing contributions, synergies realization from Stericycle acquisition, volume outlook for 2025, Stericycle acquisition synergies and contributions, and margin expectations for 2025:



Strong Financial Performance and Growth:
- WM reported strong financial performance with operating EBITDA growth of more than 10% in their legacy business for the year, achieving a 30% operating EBITDA margin for the first time in history.
- This was driven by strategic priorities including operational discipline, aggressive pricing, and significant investments in technology and sustainability.

Sustainability and Investment Impact:
- The company's sustainability investments are expected to contribute $150 million of operating EBITDA growth in their sustainability segments in 2025.
- This is attributed to the expansion of renewable energy platforms with multiple renewable natural gas facilities coming online and recycling facility upgrades.

Acquisition and Integration Strategy:
- WM completed the acquisition of Stericycle, which is expected to grow 9% before synergies in 2025, with synergy capture increasing to $100 million.
- The integration efforts, led by seasoned leaders, focused on internalization and operational efficiencies, enhancing the quality of earnings and customer service.

Volume and Pricing Dynamics:
- WM anticipates a 7% operating EBITDA growth in the collection and disposal business for 2025, maintaining pricing discipline and managing costs effectively.
- This is supported by disciplined pricing strategies, cost management, and strategic optimism in certain market segments despite challenges in industrial volumes.