Using the PEG framework with analyst consensus forward EPS growth of 14.2% plus 1.5% dividend yield, Waste Management, Inc. has a fair value of $116.38 based on NTM EPS (FY2026) of $8.20. The current PEG ratio is 1.95.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG works well for steady growers with predictable earnings.
| EPS Growth RateForward | 12.7% |
| Dividend Yield | +1.5% |
| Adjusted Growth (clamped 8–25%) | 14.2% |
| Fair P/E | 14.2x |
| NTM EPS (FY2026) | $8.20 |
| Fair Value | $116.38 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $6.70 | — | — |
| FY2026E | $8.20 | +22.4% | 21 |
| FY2027E | $9.35 | +14.1% | 20 |
| FY2028E | $10.26 | +9.6% | 15 |
| FY2029E | $11.47 | +11.8% | 11 |
| FY2030E | $12.20 | +6.4% | 7 |
5Y Forward EPS CAGR: 12.7%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $1.8B | $4.29 | — |
| FY2022 | $2.2B | $5.39 | +25.6% |
| FY2023 | $2.3B | $5.66 | +5.0% |
| FY2024 | $2.7B | $6.81 | +20.3% |
| FY2025 | $2.7B | $6.70 | -1.6% |
4Y Historical EPS CAGR: 11.8%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.