Vale vs Waste Management Which Is a Smarter Choice?

Vale and Waste Management are two leading companies in their respective industries. Vale is a multinational mining company, specializing in iron ore and other minerals, while Waste Management is a prominent waste management and environmental services provider. The stocks of both companies are closely monitored by investors due to their strong market presence and potential for growth. In this comparison, we will analyze the financial performance, sustainability practices, and future prospects of Vale and Waste Management to determine which stock may be a better investment option.

Vale or Waste Management?

When comparing Vale and Waste Management, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Vale and Waste Management.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Vale has a dividend yield of 14.15%, while Waste Management has a dividend yield of 1.67%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Vale reports a 5-year dividend growth of 17.48% year and a payout ratio of 65.65%. On the other hand, Waste Management reports a 5-year dividend growth of 8.52% year and a payout ratio of 45.06%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Vale P/E ratio at 4.52 and Waste Management's P/E ratio at 33.69. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Vale P/B ratio is 1.10 while Waste Management's P/B ratio is 11.15.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Vale has seen a 5-year revenue growth of 0.35%, while Waste Management's is 0.45%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Vale's ROE at 24.42% and Waste Management's ROE at 35.91%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $9.81 for Vale and $221.57 for Waste Management. Over the past year, Vale's prices ranged from $9.66 to $16.08, with a yearly change of 66.46%. Waste Management's prices fluctuated between $168.73 and $226.84, with a yearly change of 34.44%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.