Waste Management's new direction
Capturing value in ways that make economic sense: fueling a WM truck with methane in Oakland
Still, Waste Management has fared reasonably well since adopting its new approach. Revenues and profits fell last year because of the recession, but for the past three years shares of Waste Management have outperformed those of its chief rival, Republic Services (RSG, Fortune 500), which remains focused on collection and disposal: Waste is up by 15%, Republic is down by 2%. As it happens, Warren Buffett and Bill Gates -- through Berkshire Hathaway (BRK.A), Cascade Investment, an asset management firmed own by Gates, and the Bill & Melinda Gates Foundation -- are major holders in Republic. The Gates Foundation owns Waste Management shares too. It's not hard to discern why Buffett and Gates like the trash business: It has significant barriers to entry because new landfills are hard to site and expensive. And despite the buzz about zero waste, Americans generate lots of trash -- an average of 4.5 pounds a person per day, the EPA says.
Good luck to all,