Waste management company Waste Connections (NYSE:WCN) met Wall Street’s revenue expectations in Q4 CY2025, with sales up 5% year on year to $2.37 billion. The company’s outlook for the full year was close to analysts’ estimates with revenue guided to $9.93 billion at the midpoint. Its non-GAAP profit of $1.29 per share was 1.5% above analysts’ consensus estimates.
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Waste Connections (WCN) Q4 CY2025 Highlights:
- Revenue: $2.37 billion vs analyst estimates of $2.37 billion (5% year-on-year growth, in line)
- Adjusted EPS: $1.29 vs analyst estimates of $1.27 (1.5% beat)
- Adjusted EBITDA: $706.7 million vs analyst estimates of $791.6 million (29.8% margin, 10.7% miss)
- Operating Margin: 17.7%, up from -8.8% in the same quarter last year
- Free Cash Flow Margin: 7.3%, similar to the same quarter last year
- Market Capitalization: $43.68 billion
“Adjusted EBITDA(b) margin expansion of 110 basis points in the fourth quarter capped off a remarkable year for Waste Connections, driven by price-led organic growth in solid waste and strong execution from ongoing improvements in operating trends. For the full year 2025, we delivered industry-leading adjusted EBITDA(b) margin of 33.0%, up 100 basis points year over year, excluding the impact of lower commodities,” said Ronald J. Mittelstaedt, President and Chief Executive Officer.
Company Overview
Operating a network of municipal solid waste landfills in the U.S. and Canada, Waste Connections (NYSE:WCN) is North America's third-largest waste management company providing collection, disposal, and recycling services.
Revenue Growth
Examining a company’s long-term performance can provide clues about its quality. Any business can have short-term success, but a top-tier one grows for years. Over the last five years, Waste Connections grew its sales at an impressive 11.7% compounded annual growth rate. Its growth beat the average industrials company and shows its offerings resonate with customers.
We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Waste Connections’s annualized revenue growth of 8.6% over the last two years is below its five-year trend, but we still think the results were respectable. 
This quarter, Waste Connections grew its revenue by 5% year on year, and its $2.37 billion of revenue was in line with Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 5.2% over the next 12 months, a deceleration versus the last two years. This projection doesn't excite us and indicates its products and services will see some demand headwinds.
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Operating Margin
Waste Connections has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 15.8%. This result isn’t surprising as its high gross margin gives it a favorable starting point.
Looking at the trend in its profitability, Waste Connections’s operating margin rose by 1.2 percentage points over the last five years, as its sales growth gave it operating leverage.
This quarter, Waste Connections generated an operating margin profit margin of 17.7%, up 26.5 percentage points year on year. The increase was solid, and because its operating margin rose more than its gross margin, we can infer it was more efficient with expenses such as marketing, R&D, and administrative overhead.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.
Waste Connections’s EPS grew at a remarkable 14.2% compounded annual growth rate over the last five years, higher than its 11.7% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
Diving into Waste Connections’s quality of earnings can give us a better understanding of its performance. As we mentioned earlier, Waste Connections’s operating margin expanded by 1.2 percentage points over the last five years. On top of that, its share count shrank by 2.7%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. 
Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.
For Waste Connections, its two-year annual EPS growth of 10.9% was lower than its five-year trend. We still think its growth was good and hope it can accelerate in the future.
In Q4, Waste Connections reported adjusted EPS of $1.29, up from $1.16 in the same quarter last year. This print beat analysts’ estimates by 1.5%. Over the next 12 months, Wall Street expects Waste Connections’s full-year EPS of $5.15 to grow 8.8%.
Key Takeaways from Waste Connections’s Q4 Results
We struggled to find many positives in these results. Its EBITDA missed and its full-year revenue guidance was in line with Wall Street’s estimates. Overall, this was a weaker quarter. The stock traded down 1.8% to $168.59 immediately following the results.
Waste Connections’s earnings report left more to be desired. Let’s look forward to see if this quarter has created an opportunity to buy the stock. We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).