Can Garbage Make You Rich?

One man's trash is the next man's treasure...

Who hasn't heard that expression before, right? Although, it wasn't until just recently that I realized how true it might actually be. At least when it comes to the company Waste Management on the stock market.

Now, full disclosure for one second.., I've been on the financial freedom journey for a while now. Throughout my journey, I have researched and experimented with several methods of building wealth; the kind of wealth that lasts a lifetime. One of the most viable, of said methods, has been the stock market. It's no secret to the everyday American that you can make money by investing in the market but a very small percentage of those people actually know how that is. It takes loads of time dedicated to doing your due diligence on what companies you'd like to invest in. That is, at least if you're trying to take a more hands-on approach with your portfolio.

One company that sticks out to me the most, is the garbage disposal industry veteran Waste Management. You've probably seen it before, you know those big green garbage trucks with the yellow W and green M. In this article, I'm going to give you the run-down of why, I believe, Waste Management is the right investing option for your portfolio.

Now let's be clear about something.., I'm in no way, shape, or form, a financial advisor of any sort. I'm not telling you what I think you should do with your money; I'm simply sharing with you some of my own strategies for attaining financial freedom. What you choose to do with this information is your decision alone. Now, with that being said, these are the reasons why I'm looking to get my hands on some shares of Waste Management.

First.., What Is Waste Management?

The company was officially established in 1968 but its roots run deeper into the late 1800s. A man, by the name of Wayne Huizenga, took his grandfather's business to his two associates (Dean Buntrock and Larry Beck). Together the three men founded Waste Management Inc. out of Texas. They then quickly proceeded to buy out all of the other smaller garbage disposal companies across the country. Securing their position as one of the biggest garbage disposal companies in the nation, if not the entire world. Since its debut, the company's history has been a rollercoaster ride of ups and downs. In fact, it's not even really known as Waste Management anymore, as of 2022, it's just WM. A subtle change but once you research the reason behind it, you'll begin to feel comfortable in the company's future; regardless of its past. (But we'll get back to that later.)

Appreciate The Appreciation

If you follow my work, you'd know several days ago I published an article on the possibility of getting rich by investing in AT&T. I'm not going to get too deep into it, so, I've left a link at the bottom, if you're interested in learning more about that. However, one of the main talking points of the piece was the company's ability to generate its shareholder's wealth through dividends. That's a kickback companies give their shareholders and basically a means of earning passive income.

It is also not the same way that I see myself getting rich by investing in shares of WM.

There are ultimately two ways for investors to make money through the stock market; dividends and appreciation. Appreciation is when you purchase a share of a company at a certain value and then wait for that value to rise up as the company grows.

As you can see based on the screenshot above, the overall cost per share for WM has, for the most part, only gone up. This makes the company more of an appreciation stock pick for investors and their portfolios. While the company does pay a dividend, it isn't a big one and it wouldn't be the priority of your investment. Although, receiving said dividend in the meantime does sweeten the deal... (Gimmy Gimmy).

The BluePrint

Basically, the idea is you buy in as much as you can now and just watch it grow over time, as you add to it. Like any money tree, you got to consistently water it for it to grow. Think of your shares of WM like that.., money trees.

I mean it only makes sense right? The human population is only increasing and with it, so is the amount of trash we produce. If the rate at which our species produces garbage only continues to increase, then the demand to dispose of said garbage would increase as well. If you take the trajectory of the company's average cost per share into account, then investing in WM would be a viable option to protect your wealth from inflation (which pretty much does the opposite).

If you're worried about the garbage disposal industry getting overtaken by some other more innovative company, then worry not. Remember when I said that the significance behind the company rebranding to WM was relevant? Well here's why. The top brass within the company felt like the change in the name represents their vision to move beyond simple waste disposal and onto other projects. Projects such as searching for fresh innovative ways to dispose of waste; this also includes more "eco-friendly" ways to get rid of our garbage.

In fact, when the president and CEO of Houston-based Waste Management Inc., Jim Fish, was asked about the rebrand, this was his answer:

"The company is officially shortening its name to just WM, the firm's decades-long approach to sustainability has made it much more than a waste management company.”

Morale of the story is, if you're looking to start investing you're cash into building wealth. And you're looking towards stocks as your means of doing that. Than Waste Management or WM, for short, is the perfect option. Whether you're just getting started or you're a seasoned investing veteran, owning a position in WM will give your portfolio the diversity it needs if you're planning on getting rich this way.

The company checks off all of the boxes. Throughout the course of its history, the value per share on the market has only ever gone up and if history repeats itself as it often tends to do, then it will continue to do so. In regards to staying ahead of the competition, they are one of the leaders if not the top company within their industry. Their determination to gain recognition for being more than just a waste management company further supports this prediction. The cherry on top of this delicious investing sundae? That sweet, sweet dividend! It isn't all that high of a dividend payout but given the fact that you're holding for the long term, either way, any extra money you get in the process should be a bonus you welcome with open arms.