Head-To-Head Survey: Select Water Solutions (NYSE:WTTR) & Waste Management (NYSE:WM)

Waste Management (NYSE:WM) and Select Water Solutions (NYSE:WTTR) are both business services companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, risk and profitability.

Analyst Ratings

This is a summary of current ratings and price targets for Waste Management and Select Water Solutions, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Waste Management	0	10	15	3	2.75
Select Water Solutions	0	3	2	1	2.67

Waste Management currently has a consensus target price of $248.25, suggesting a potential upside of 19.50%. Select Water Solutions has a consensus target price of $14.25, suggesting a potential upside of 46.29%. Given Select Water Solutions’ higher probable upside, analysts clearly believe Select Water Solutions is more favorable than Waste Management.

Risk and Volatility

Waste Management has a beta of 0.62, meaning that its share price is 38% less volatile than the S&P 500. Comparatively, Select Water Solutions has a beta of 1.18, meaning that its share price is 18% more volatile than the S&P 500.

Valuation and Earnings

This table compares Waste Management and Select Water Solutions”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Waste Management	$24.78 billion	3.38	$2.75 billion	$6.35	32.71
Select Water Solutions	$1.45 billion	0.81	$30.64 million	$0.19	51.27

Waste Management has higher revenue and earnings than Select Water Solutions. Waste Management is trading at a lower price-to-earnings ratio than Select Water Solutions, indicating that it is currently the more affordable of the two stocks.

Dividends

Waste Management pays an annual dividend of $3.30 per share and has a dividend yield of 1.6%. Select Water Solutions pays an annual dividend of $0.28 per share and has a dividend yield of 2.9%. Waste Management pays out 52.0% of its earnings in the form of a dividend. Select Water Solutions pays out 147.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Waste Management has increased its dividend for 22 consecutive years and Select Water Solutions has increased its dividend for 2 consecutive years.

Profitability

This table compares Waste Management and Select Water Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Waste Management	10.35%	33.00%	6.52%
Select Water Solutions	1.41%	2.26%	1.38%

Institutional and Insider Ownership

80.4% of Waste Management shares are owned by institutional investors. Comparatively, 81.7% of Select Water Solutions shares are owned by institutional investors. 0.2% of Waste Management shares are owned by insiders. Comparatively, 7.6% of Select Water Solutions shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Waste Management beats Select Water Solutions on 12 of the 18 factors compared between the two stocks.

About Waste Management

Waste Management, Inc., through its subsidiaries, engages in the provision of environmental solutions to residential, commercial, industrial, and municipal customers in the United States and Canada. It offers collection services, including picking up and transporting waste and recyclable materials from where it was generated to a transfer station, material recovery facility (MRF), or disposal site; and owns and operates transfer stations, as well as owns, develops, and operates landfill facilities that produce landfill gas used as renewable natural gas for generating electricity. As of December 31, 2022, the company owned or operated 254 solid waste landfills, five secure hazardous waste landfills, 97 MRFs, and 337 transfer stations. It also provides materials processing and commodities recycling services at its MRFs, where cardboard, paper, glass, metals, plastics, construction and demolition materials, and other recycling commodities are recovered for resale or redirected for other purposes; recycling brokerage services, such as managing the marketing of recyclable materials for third parties; and other strategic business solutions. In addition, the company offers construction and remediation services; services related with the disposal of fly ash, and residue generated from the combustion of coal and other fuel stocks; in-plant services comprising full-service waste management solutions and consulting services; and specialized disposal services for oil and gas exploration and production operations. The company was formerly known as USA Waste Services, Inc. and changed its name to Waste Management, Inc. in 1998. Waste Management, Inc. was incorporated in 1987 and is headquartered in Houston, Texas.

About Select Water Solutions

Select Water Solutions, Inc., together with its subsidiaries, provides water management and chemical solutions to the energy industry in the United States. The company operates through three segments: Water Services, Water Infrastructure, and Chemical Technologies. The Water Services segment provides water-related services, including water sourcing, water transfer, flowback and well testing, water containment, fluids hauling, water monitoring, and water network automation; technology solutions comprising hydrographic mapping, water volume and quality monitoring, remote pit and tank monitoring, leak detection, asset and fuel tracking, and automated-equipment services, as well as various surface rental equipment and workforce accommodation services. The Water Infrastructure segment engages in the recycling, gathering, transferring, and disposal of water through a network of permanent pipeline infrastructure, semi-permanent pipeline infrastructure, water recycling facilities, earthen pits, water sources, and SWDs; provides solids management services; and develops, builds, and operates semi-permanent and permanent infrastructure solutions. The Chemical Technologies segment provides technical solutions, products, and services related to chemical applications in the oil and gas industry. This segment develops, manufactures, and manages logistics; and provides chemicals used in hydraulic fracturing, stimulation, cementing, and well completions for pressure pumpers and oil and gas producers, as well as offers production chemical solutions for underperforming wells, corrosion and scale monitoring, chemical inventory management, well failure analysis, and lab services. It primarily serves oil and gas producers. The company was formerly known as Select Energy Services, Inc. and changed its name to Select Water Solutions, Inc. in May 2023. Select Water Solutions, Inc. was incorporated in 2016 and is headquartered in Houston, Texas.