Waste Management Is Down 10%. What History Says.

Waste Management Is Down 10% in 150 Days. What History Says.

Waste Management, Inc. (WM) is down 10% from its all-time high as of August 25, 2026, and has been falling for approximately 150 days. The Drawdown Severity Score™ stands at 2.1, placing the stock in the yellow zone after transitioning from the green zone. In 49 comparable prior drops of 5% or more, the stock took an average of 240 days to resolve the drawdown.

Waste Management Crosses Into the Yellow Zone After 154 Days

As of August 25, 2026, WM has crossed a critical threshold, moving from the green zone to the yellow zone. This transition indicates that the stock has entered a state of moderately elevated drawdown risk. The stock closed at $222.13, which represents a -9.9% decline from its all-time high of $246.51.

Our data shows that this drawdown has persisted for 154 days. The transition to the yellow zone indicates that the price decline is no longer a minor, short-term fluctuation. In our framework, the yellow zone serves as an early warning phase, distinguishing routine market volatility from more prolonged structural declines.

Historically, WM has demonstrated lower volatility compared to the broader market, making this extended drawdown period highly notable. The move into the yellow zone suggests that the selling pressure has sustained itself far longer than a typical minor pullback. Investors tracking this asset should monitor whether the price stabilizes or continues its downward trajectory toward deeper severity levels.

Analyzing the Drawdown Severity Score™ for WM

The Drawdown Severity Score™ for WM stands at 2.1 as of August 25, 2026. This score is derived from our proprietary risk model, which evaluates the depth, speed, and duration of the current decline against the asset's complete historical record. A score of 2.1 indicates that the current pullback is moderately severe relative to the stock's historical behavior.

To understand the significance of this score, we must examine WM's historical drawdown footprint. Across the asset's trading history, we have recorded a total of 245 historical drawdown events. The average max drawdown across all 245 events is -4.2%, with an average drawdown duration of 54 days.

Comparing the current metrics to these historical averages reveals a clear divergence. The current drawdown of -9.9% is more than double the historical average max drawdown of -4.2%. Furthermore, the current duration of 154 days is nearly triple the historical average duration of 54 days. This comparison indicates that the current pullback is an outlier compared to the typical minor retracements WM experiences.

The elevated severity score reflects this divergence in both depth and duration. While a -9.9% drop might be considered minor for high-beta technology stocks, it represents a substantial departure from the norm for a defensive asset like WM. The duration of 154 days indicates that the stock has struggled to find a firm bottom, keeping the severity score in the moderately elevated range.

Historical Comparison: How Prior 5% Pullbacks Played Out

To gain deeper insight into the current decline, we can isolate historical drawdowns of similar magnitude. Our database shows that WM has experienced a drawdown of 5% or more 49 times in its history. Evaluating these specific events provides a historical baseline for how long the stock typically remains in this depressed state.

Among these 49 comparable drops, the average duration of the drawdown was 240 days. As of August 25, 2026, the current drawdown has lasted 154 days, meaning it has run for 86 days less than the historical average for 5%+ pullbacks. This suggests that while the current decline is lengthy compared to all drawdowns, it is still well within the historical timeframe of deeper corrections.

Below is a detailed breakdown comparing the current drawdown metrics to these historical baselines:

Analyzing this historical data shows that once WM breaches the 5% drawdown threshold, recovery is rarely swift. The 240-day average duration for these deeper pullbacks indicates that the stock often undergoes prolonged periods of consolidation before reclaiming its previous highs. With the current drawdown at 154 days, history suggests that a rapid recovery would be ahead of schedule compared to past patterns.

Valuation Context: Historical Multiples vs. Price Drawdown

To provide historical context, we examine how the price drawdown aligns with the asset's valuation multiples as of 2026-08-24. Despite the -9.9% price decline from its peak, the Price-to-Sales (P/S) ratio stands at 3.5, which ranks in the 81st percentile of its own daily history since 2006-08-21 and sits above its historical median of 2.2. Similarly, the EV-to-EBITDA (EV/EBITDA) ratio of 14.6 sits in the 77th percentile of its daily history since 2006-08-21, remaining above its historical median of 11.1. This shows that while the stock price has fallen, the valuation multiples remain elevated relative to the asset's own long-term historical distribution.

Methodological Limits of Drawdown-Only Analysis

This analysis relies strictly on historical price data, drawdown metrics, and valuation ratios. We do not incorporate external qualitative factors, macroeconomic indicators, or individual corporate announcements into this evaluation. This quantitative framework is designed to isolate and analyze price behavior patterns, meaning it does not account for forward-looking operational changes or broader market shifts that might influence future performance.

By focusing entirely on the mathematical reality of the drawdown, we avoid the noise of market sentiment and narrative-driven explanations. However, investors should recognize that historical price patterns do not guarantee future outcomes. While the Drawdown Severity Score™ provides a disciplined, data-driven look at historical risk, it should be used as one of many tools in a comprehensive research process.

What to Watch Next: Key Severity Thresholds for WM

As WM remains in the yellow zone, several key metrics will determine whether the technical picture improves or worsens. The first critical marker is the 240-day duration threshold, which represents the historical average duration for drawdowns of 5% or more. If the current drawdown extends past 240 days without reclaiming the all-time high, it will mark an atypically prolonged recovery phase even for deeper corrections.

The second key metric is the -10% drawdown level. As of August 25, 2026, the stock sits just above this level at -9.9%. A sustained move below -10% would represent a psychological milestone and could trigger a recalculation of the severity score, potentially pushing it deeper into the yellow zone or toward the red zone if accompanied by accelerating downward momentum.

Conversely, a contraction in the severity score would require a steady march back toward the all-time high of $246.51. If the price begins to recover, the Drawdown Severity Score™ will decline, signaling a transition back into the low-risk green zone. We will continue to track these metrics daily to monitor how this drawdown compares to WM's historical recovery patterns.