Analyzing Waste Connections (NYSE:WCN) & Montrose Environmental Group (NYSE:MEG)

Waste Connections (NYSE:WCN) and Montrose Environmental Group (NYSE:MEG) are both business services companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, institutional ownership, valuation, profitability and risk.

Profitability

This table compares Waste Connections and Montrose Environmental Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Waste Connections	6.65%	16.07%	6.37%
Montrose Environmental Group	-2.52%	0.17%	0.08%

Analyst Ratings

This is a summary of recent recommendations and price targets for Waste Connections and Montrose Environmental Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Waste Connections	1	3	15	5	3.00
Montrose Environmental Group	1	2	3	0	2.33

Waste Connections presently has a consensus price target of $206.68, indicating a potential upside of 21.40%. Montrose Environmental Group has a consensus price target of $33.50, indicating a potential upside of 45.73%. Given Montrose Environmental Group’s higher possible upside, analysts plainly believe Montrose Environmental Group is more favorable than Waste Connections.

Valuation and Earnings

This table compares Waste Connections and Montrose Environmental Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Waste Connections	$8.92 billion	4.88	$617.57 million	$2.40	70.94
Montrose Environmental Group	$696.40 million	1.17	-$62.31 million	($0.91)	-25.26

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

Institutional & Insider Ownership

86.1% of Waste Connections shares are owned by institutional investors. Comparatively, 87.9% of Montrose Environmental Group shares are owned by institutional investors. 0.3% of Waste Connections shares are owned by insiders. Comparatively, 11.9% of Montrose Environmental Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Volatility & Risk

Waste Connections has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500. Comparatively, Montrose Environmental Group has a beta of 1.97, indicating that its share price is 97% more volatile than the S&P 500.

Summary

Waste Connections beats Montrose Environmental Group on 11 of the 15 factors compared between the two stocks.

About Waste Connections

Waste Connections, Inc. provides non-hazardous waste collection, transfer, disposal, and resource recovery services in the United States and Canada. It offers collection services to residential, commercial, municipal, industrial, and exploration and production (E&P) customers; landfill disposal services; and recycling services for various recyclable materials, including compost, cardboard, mixed paper, plastic containers, glass bottles, and ferrous and aluminum metals. The company owns and operates transfer stations that receive compact and/or load waste to be transported to landfills or treatment facilities through truck, rail, or barge; and intermodal services for the rail haul movement of cargo and solid waste containers in the Pacific Northwest through a network of intermodal facilities. In addition, it provides E&P waste treatment, recovery, and disposal services for waste resulting from oil and natural gas exploration and production activity, such as drilling fluids, drill cuttings, completion fluids, and flowback water; production wastes and produced water during a well's operating life; contaminated soils that require treatment during site reclamation; and substances, which require clean-up after a spill, reserve pit clean-up, or pipeline rupture. Further, the company offers leasing services to its customers. Waste Connections, Inc. was founded in 1997 and is based in Woodbridge, Canada.

About Montrose Environmental Group

Montrose Environmental Group, Inc. operates as an environmental services company in the United States, Canada, and internationally. The company operates in three segments: Assessment, Permitting and Response; Measurement and Analysis; and Remediation and Reuse. The Assessment, Permitting and Response segment provides scientific advisory and consulting services to support environmental assessments; environmental emergency response and recovery; toxicology consulting and environmental audits and permits for current operations; facility upgrades; new projects; decommissioning projects; and development projects. This segment also offers technical advisory and consulting services, including regulatory compliance support and planning, environmental, ecosystem and toxicological assessments, and support during responses to environmental disruptions. The Measurement and Analysis segment tests and analyzes air, water, and soil to determine concentrations of contaminants, as well as the toxicological impact of contaminants on flora, fauna, and human health. Its services include source and ambient air testing and monitoring, leak detection, and advanced analytical laboratory services, such as storm water, wastewater, and drinking water analysis. The Remediation and Reuse segment provides engineering, design, implementation, and operations and maintenance services primarily to treat contaminated water, remove contaminants from soil, or create biogas from waste. The company serves financial, oil and gas, utilities, construction, automotive, real-estate, midstream energy, manufacturing, commodities, petrochemical, food and beverage, telecommunications, and engineering industries, as well as local, state, provincial, and federal government entities. Montrose Environmental Group, Inc. was founded in 2012 and is headquartered in North Little Rock, Arkansas.