Intangible Assets, Cost Advantage Boost Waste Management
We're upgrading the firm to wide moat, but shares are pricey today.
Matthew Young: We recently upgraded our economic moat rating for Waste Management to wide from narrow. Recall Waste Management provides collection, disposal, and recycling services to customers across commercial, industrial, and residential end markets.
In terms of the wide moat, we have a high level of confidence the firm will be generating economic returns a decade from now. Waste Management enjoys a robust competitive positioning in the waste-services landscape, especially relative to the hundreds of small providers, most of which aren't vertically integrated with landfills, a preferred asset. In short, we think the moat is rooted in intangible assets and cost advantage.
Matthew Young does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.