Waste Connections (WCN) Stock Forecast & Price Target

Waste Connections demonstrates a robust financial outlook supported by a 2.4% year-over-year organic revenue growth in Q2, primarily driven by a solid waste core pricing increase of 6.6%. The company's underlying solid waste margin has also expanded by 70 basis points year-over-year, successfully offsetting headwinds from recycled commodities and Renewable Identification Numbers (RINs). Additionally, the firm anticipates a further 60 basis points of margin improvement in the second half of 2025, indicating sustainable profitability improvements aligned with operational efficiency.

Waste Connections has exhibited a concerning trend with solid waste volumes declining by 2.6%, reflecting ongoing macroeconomic and tariff uncertainties, particularly in the construction markets, which could severely hinder revenue growth. Furthermore, the company faces substantial headwinds in pricing for recycled commodities, with prices for OCC and RIN declining by approximately 30% year-over-year, translating to a negative impact of $25 million and $5 million on earnings in the second half of the year. Additionally, despite a slight improvement in leverage metrics, the potential for underperformance in solid waste volumes, coupled with ongoing commodity price challenges, suggests a troubling outlook for the firm’s financial performance moving forward.