When comparing various industries, one can quickly realize that the waste management industry is better than most. Within this industry operates Waste Connections, Inc. (WCN), which, we will argue, is one of the best in the business. Although not favorably valued at the moment, it has seen strong growth through responsible acquisitions and a well-thought-out operating strategy. As a result, it's possible that Waste Connections' premium can be justified.
Waste Connections is one of the largest waste disposal companies in the world. It has proven to be resilient in a wild 2020. Both the company's business and stock performances have provided its investors with some much-needed stability throughout the turbulence.
What we like about this industry is that companies basically have a monopoly in the cities/towns in which they operate. As a result, a company like Waste Connections does not have to worry about being undercut by competitors once deals have been struck with customers. In addition, if the customer has had no issues with their current waste company, then it is very likely that contracts will be renewed at expiration. This provides a moat to all companies operating within the industry.
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