Waste Management (NYSE:WM) versus Shimmick (NASDAQ:SHIM) Critical Review

Waste Management (NYSE:WM) and Shimmick (NASDAQ:SHIM) are both business services companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, analyst recommendations, dividends, institutional ownership, earnings, valuation and profitability.

Valuation & Earnings

This table compares Waste Management and Shimmick”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Waste Management	$22.06 billion	4.04	$2.75 billion	$6.35	34.87
Shimmick	$495.98 million	0.21	-$124.75 million	($1.78)	-1.61

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

Analyst Recommendations

This is a breakdown of current recommendations for Waste Management and Shimmick, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Waste Management	0	10	17	3	2.77
Shimmick	1	0	0	0	1.00

Waste Management presently has a consensus price target of $248.95, suggesting a potential upside of 12.44%. Given Waste Management’s stronger consensus rating and higher probable upside, analysts plainly believe Waste Management is more favorable than Shimmick.

Institutional and Insider Ownership

80.4% of Waste Management shares are owned by institutional investors. Comparatively, 6.9% of Shimmick shares are owned by institutional investors. 0.2% of Waste Management shares are owned by company insiders. Comparatively, 77.0% of Shimmick shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Waste Management and Shimmick’s 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%
Shimmick	-12.33%	N/A	-22.96%

Volatility & Risk

Waste Management has a beta of 0.58, indicating that its share price is 42% less volatile than the S&P 500. Comparatively, Shimmick has a beta of 0.62, indicating that its share price is 38% less volatile than the S&P 500.

Summary

Waste Management beats Shimmick on 13 of the 15 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 Shimmick

Shimmick Corporation provides water and other critical infrastructure solutions in the United States. The company undertakes water and wastewater treatment infrastructure; water storage and conveyance, including dams, levees, flood control systems, pump stations, and coastal protection infrastructure; and mass transit, bridges, and military infrastructure projects. It serves federal, state, and local governments. The company was formerly known as SCCI National Holdings, Inc. and changed its name to Shimmick Corporation in September 2023. Shimmick Corporation was founded in 1990 and is headquartered in Irvine, California. Shimmick Corporation operates as a subsidiary of GOHO, LLC.