GFL Environmental Inc. (NYSE: GFL)

Sector: Industrials Industry: Waste Management CIK: 0001780232
Market Cap 16.72 Bn
P/B 3.03
P/E 6.39
P/S 3.34
ROIC (Qtr) 4.07
Div Yield % 0.09
Rev 1y % (Qtr) 7.43
Total Debt (Qtr) 5.71 Bn
Debt/Equity (Qtr) 1.03

About

Price action

Investment thesis

Bull case

  • Operating cash flow of 1.04B provides strong 13.16x coverage of stock compensation 79.06M, indicating sustainable incentive practices.
  • Tangible assets of 7.86B provide robust 197.21x coverage of other current liabilities 39.86M, indicating strong asset backing.
  • Strong cash position of 141.01M provides 3.54x coverage of other current liabilities 39.86M, indicating excellent liquidity.
  • Retained earnings of 147.25M provide strong 3.69x coverage of other current liabilities 39.86M, indicating earnings quality.
  • Operating cash flow of 1.04B provides solid 0.73x coverage of current liabilities 1.42B, showing strong operational health.

Bear case

  • Operating cash flow of 1.04B barely covers its investment activities of 3.06B, with a coverage ratio of 0.34, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 1.04B provides thin coverage of dividend payments of (22.46M) with a -46.32 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 141.01M provide limited coverage of acquisition spending of 3.91B, which is 0.04x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Free cash flow of 190.22M provides weak coverage of capital expenditures of 850.36M, with a 0.22 ratio suggesting additional external financing needs for growth initiatives.
  • Operating cash flow of 1.04B provides minimal -14.43x coverage of tax expenses of (72.10M), suggesting potential tax planning inefficiencies or unsustainable tax positions.

Segments [axis] Breakdown of Revenue (2024)

Segments [axis] Breakdown of Revenue (2024)

Peer comparison

Companies in the Waste Management
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 WM Waste Management Inc 99.66 Bn 99.17 7.44 23.36 Bn
2 RSG Republic Services, Inc. 73.30 Bn 99.83 7.97 13.27 Bn
3 WCN Waste Connections, Inc. 42.09 Bn 67.66 4.50 8.96 Bn
4 GFL GFL Environmental Inc. 16.72 Bn 6.39 3.34 5.71 Bn
5 CLH Clean Harbors Inc 13.63 Bn 35.09 2.29 3.02 Bn
6 CWST Casella Waste Systems Inc 6.36 Bn 417.00 3.54 1.23 Bn
7 NVRI ENVIRI Corp 1.48 Bn -8.91 0.66 1.67 Bn
8 MEG Montrose Environmental Group, Inc. 0.86 Bn -30.94 1.04 0.37 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.11 1.86
EV to Cash from Ops. EV/CFO 14.92 1.99
EV to Debt EV to Debt 2.72 141.65
EV to EBIT EV/EBIT 5.18 10.83
EV to EBITDA EV/EBITDA 10.74 -3.88
EV to Free Cash Flow [EV/FCF] EV/FCF 81.60 9.06
EV to Market Cap EV to Market Cap 0.93 0.66
EV to Revenue EV/Rev 3.10 8.81
Price to Book Value [P/B] P/B 3.03 4.15
Price to Earnings [P/E] P/E 6.39 33.89
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 84.41 4.52
Dividend Payout Ratio % Div Payout % (Qtr) 0.90 7.28
Dividend per Basic Share Div per Share (Qtr) 0.04 0.36
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 6.07 6.04
Interest Coverage Int. cover (Qtr) 6.61 -114.06
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -9.52 -42.93
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 92.74 59.31
Dividend Growth (1y) % Div 1y % (Qtr) -20.00 0.43
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 19,971.71 1,182.04
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 9.30 332.85
EBIT Growth (1y) % EBIT 1y % (Qtr) 16,541.68 973.21
EBT Growth (1y) % EBT 1y % (Qtr) 602.64 159.54
EPS Growth (1y) % EPS 1y % (Qtr) 598.20 85.89
FCF Growth (1y) % FCF 1y % (Qtr) -19.23 -19.83
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 21.95 10.50
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.26 0.60
Cash Payout Ratio Cash Payout (Qtr) 0.01 0.02
Cash Ratio Cash Ratio (Qtr) 0.10 0.60
Current Ratio Curr Ratio (Qtr) 0.69 1.57
Debt to Equity Ratio Debt/Equity (Qtr) 1.03 0.73
Interest Cover Ratio Int Coverage (Qtr) 6.61 -114.06
Times Interest Earned Times Interest Earned (Qtr) 6.61 -114.06
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 79.80 -42.95
EBIT Margin % EBIT Margin % (Qtr) 82.57 -56.49
EBT Margin % EBT Margin % (Qtr) 50.78 -61.58
Gross Margin % Gross Margin % (Qtr) 20.40 17.43
Net Profit Margin % Net Margin % (Qtr) 52.20 -71.04