Everyone Loves Trash

October 24, 2021
October 24, 2021 Ryan

Everyone Loves Trash

Everyone loves trash.

As happy consumers, we produce trash constantly – lots of it.   Americans lead the world in municipal waste per capita and it seems we have no interest in changing this pattern any time soon.  Our desperate attempt to keep up with the Joneses forces us to buy stuff we don’t need and replace items that work perfectly fine.  Ugh, all that fast food trash. Spend, spend, spend.  Trash, trash, trash.

Consumerism, high relative levels of disposable income, and an impending infrastructure bill all come together nicely to support positive moves in the solid waste industry.  As an investor, I’m not first to the game of buying companies in the waste disposal and recycling market, but the infrastructure bill makes this a timely conversation.  This is not a near term trade without risks, however.  We must consider inflationary pressures and the investments that may provide some level of safety.  This sector isn’t a perfect inflation-hedge fit, but still interesting.

There are a lot of companies in the solid waste disposal and recycling sector worth watching, but I’m only interested in leaders – especially in an inflationary environment.   These include WM, CLH, RSG, CWST, SRCL, AQUA, and GFL.  Most have these stocks are at or near 52 weeks high and I’m not comfortable adding here (RSI extended, etc). However, I will add on pullbacks in a name or two from this list.

Watch levels as of 10/24 (will revisit in a few weeks):

  • WM – alert set at 157
  • CLH – alert set at 106
  • RSG – alert set at 127
  • CWST – alert set at 80
  • SRCL – watching volume into earnings
  • AQUA – interesting here if it consolidates a few days
  • GFL – alert set at 38.50

trade-em well. disclaimer 

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