Wunderlich Securities Reiterates Hold and PT of 40 on Waste Management

Wunderlich Securities reiterated its Hold rating on Waste Management

. At the same time, Wunderlich left its price target unchanged at $40. In a research report published today, Wunderlich states, "Our Hold rating and $40 price target on Waste Management (

) is based on WM being range-bound on its FCF at $1.25B to $1.35B for the foreseeable future. Baseline FCF should be $1.5B. WM's current valuation is nearly at our price target and we believe it is fairly valued with limited upside until WM is able to demonstrate the magnitude of savings achieved via its cost initiatives. The earliest sign of positive improvements is not likely to occur until 3Q11, and the potential for the full impact will not be seen until 1H12. We look for WM to bring significant additional transparency to driving operating leverage from these investments around its 4Q11 earnings release and 2012 outlook." At the moment, Waste Management is trading around $38.74, or 0.36% below Tuesday's close.