Price to Operating Profit (P/OP)
since 2005
Calculation
Waste Management Inc., P/OP, long-term trends, calculation
| P/OP | = | Share price1, 2, 3 | ÷ | Operating profit per share1 | Operating profit per share1 | = | Income from operations1 (in millions) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 15, 2022 | 19.95 | = | 142.68 | ÷ | 7.15 | 7.15 | = | 2,965 | ÷ | 414,586,718 | |
| Feb 22, 2021 | 19.22 | = | 110.56 | ÷ | 5.75 | 5.75 | = | 2,434 | ÷ | 423,152,948 | |
| Feb 13, 2020 | 19.50 | = | 124.23 | ÷ | 6.37 | 6.37 | = | 2,706 | ÷ | 424,708,758 | |
| Feb 14, 2019 | 15.02 | = | 98.84 | ÷ | 6.58 | 6.58 | = | 2,789 | ÷ | 423,779,540 | |
| Feb 15, 2018 | 13.82 | = | 84.02 | ÷ | 6.08 | 6.08 | = | 2,636 | ÷ | 433,673,878 | |
| Feb 16, 2017 | 13.63 | = | 71.18 | ÷ | 5.22 | 5.22 | = | 2,296 | ÷ | 439,703,007 | |
| Feb 18, 2016 | 12.05 | = | 55.31 | ÷ | 4.59 | 4.59 | = | 2,045 | ÷ | 445,652,359 | |
| Feb 17, 2015 | 10.77 | = | 53.94 | ÷ | 5.01 | 5.01 | = | 2,299 | ÷ | 459,128,449 | |
| Feb 18, 2014 | 17.97 | = | 41.72 | ÷ | 2.32 | 2.32 | = | 1,079 | ÷ | 464,821,875 | |
| Feb 14, 2013 | 9.33 | = | 37.14 | ÷ | 3.98 | 3.98 | = | 1,851 | ÷ | 465,200,137 | |
| Feb 16, 2012 | 7.83 | = | 34.42 | ÷ | 4.40 | 4.40 | = | 2,028 | ÷ | 461,374,381 | |
| Feb 17, 2011 | 8.53 | = | 37.98 | ÷ | 4.45 | 4.45 | = | 2,116 | ÷ | 475,487,984 | |
| Feb 16, 2010 | 8.46 | = | 32.90 | ÷ | 3.89 | 3.89 | = | 1,887 | ÷ | 484,972,117 | |
| Feb 17, 2009 | 6.30 | = | 28.63 | ÷ | 4.55 | 4.55 | = | 2,234 | ÷ | 491,461,631 | |
| Feb 19, 2008 | 7.43 | = | 33.83 | ÷ | 4.55 | 4.55 | = | 2,254 | ÷ | 495,349,812 | |
| Feb 15, 2007 | 9.37 | = | 35.65 | ÷ | 3.81 | 3.81 | = | 2,029 | ÷ | 533,077,368 | |
| Feb 21, 2006 | 10.84 | = | 33.90 | ÷ | 3.13 | 3.13 | = | 1,710 | ÷ | 546,684,987 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of Waste Management Inc. Annual Report.
The share price of the company demonstrates an overall upward trend over the analyzed period. Starting at $33.9 in February 2006, the price experienced fluctuations in the early years, including a dip in 2009 to $28.63. Following this, there was a consistent rise, peaking at $124.23 in February 2020. Despite a slight decline to $110.56 in February 2021, the share price rebounded strongly, reaching $142.68 by February 2022.
Operating profit per share (OPPS) exhibited moderate growth with some variability. Initially, OPPS grew from $3.13 in 2006 to a local peak of $4.55 in 2008 and 2009. After a decrease in 2010, it fluctuated around the mid-range values before climbing steadily from 2017 onward. By February 2022, OPPS reached $7.15, indicating improvement compared to earlier years, though the growth was not strictly linear and included periods of decline.
The price to operating profit ratio (P/OP) reflects changing market valuation dynamics relative to profitability. Initially, this ratio decreased from 10.84 in 2006 to a low of 6.3 in 2009, suggesting relatively lower pricing compared to operating profits during that period. However, since 2009, the ratio increased markedly, reaching highs above 19 from 2020 onwards. This indicates that the share price grew disproportionately faster than operating profit per share in recent years, reflecting heightened market expectations or valuation premium.
- Summary of Trends
- - Steady long-term increase in share price with periods of volatility.
- - Operating profit per share showed moderate growth with fluctuations and a stronger upward movement post-2017.
- - Price to operating profit ratio declined through 2009 but rose substantially thereafter, suggesting escalating valuation multiples.
- - The divergence between share price growth and operating profit growth in the later years indicates increased investor optimism or market valuation emphasis beyond current earnings.