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Trash, waste


Environmental Services Giant With More Than 15 Years of Dividend Growth Strengthens Position on Best Dividend Stocks List

Trash isn’t exactly glamorous, but what it lacks in excitement, it makes up for in steadfastness. Despite shifts in how we work and play, trash hauling remains a lucrative business and provides plenty of cash flows/dividends for investors. And our Best Dividend Stocks List pick in the sector was one of the main beneficiaries.

Our pick is one of the largest trash haulers in the nation. Its size and scope allowed it to navigate the pandemic relatively unscathed. While commercial sources of revenue sank during the pandemic, stay-at-home orders have boosted demand in residential neighborhoods. This balance has kept the firm’s revenues at a steady pace.

Heading into the new year, our pick is already seeing some tremendous growth.

Thanks to rising industrial activity and the re-opening of the economy, trash volumes have already started to rise. Our pick has been quick to capitalize on the change. Moving forward, this new normal creates an interesting environment where both residential and commercial demand is higher. People will return to offices, but many will remain working from home or third-party locations. As a result, management at our pick estimates that for the full year, revenues will grow by more than 12.5%. That’s pretty impressive tech-like growth for a garbage company.

Better still is our pick has continued to see better margins from all that hauling. Thanks to aggressive cost cutting, investments in technology and continued price improvements, margins have boosted significantly. As a result, earnings jumped by more than 14% during the first quarter of 2021, while cash flows surged by 44% year-over-year.

All of the strong performances and future potential allowed our pick to up its dividend by nearly 6% during the quarter.

To summarize, here are five reasons why you should own this stock:

  • One of the largest environmental services firms in North America with over $10 billion in annual revenues.
  • Thanks to cost cutting and tech upgrades, our pick realized more than $1 billion in free cash flows last quarter.
  • Increased its dividend for more than 15 years.
  • Big winner in the current economic re-opening and continued work-from-home environment.
  • Healthy payout ratio of 52% and growing yield of 1.56%.

Our Best Dividend Stocks List has 20 of the highest-rated stocks by our proprietary Dividend.com Rating system. Go Premium to find out the entire list.

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