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Phoenix-based Republic Services, Inc. (RSG) offers environmental services in the U.S. and Canada. With a market cap of $64.4 billion, Republic Services operates as the second-largest provider of non-hazardous solid waste collection, transfer, disposal, recycling, and energy services in the U.S. The waste management giant is expected to release its Q3 earnings after the market closes on Tuesday, Oct. 29.
Ahead of the event, analysts expect Republic Services to report a profit of $1.62 per share, up 5.2% from $1.54 per share reported in the year-ago quarter. The company has consistently surpassed Wall Street’s adjusted EPS projections in each of the past four quarters. Its adjusted EPS for the last reported quarter grew 14.2% year-over-year to $1.61, exceeding the consensus estimates by 5.2%.
For fiscal 2024, analysts expect Republic Services to report an adjusted EPS of $6.18, up 10.2% from $5.61 in fiscal 2023. In fiscal 2025, its adjusted EPS is expected to grow 9.9% year-over-year to $6.79.
RSG has gained 24.8% on a YTD basis, outperforming the S&P 500 Index’s ($SPX) 22.9% gains and the Industrial Select Sector SPDR Fund’s (XLI) 22.2% returns during the same time frame.
Despite reporting better-than-expected Q2 earnings results on July 24, shares of Republic Services dipped 5.2%. The company reported a robust 8.6% year-over-year growth in revenues, reaching $4 billion, exceeding Wall Street’s topline estimates, driven by a 5.6% organic growth and 3% growth from acquisitions.
Moreover, the waste manager reported a 116 basis points net margin expansion to 12.6%, translating into a massive 19.7% surge in net income to shareholders, totaling $511.5 million. Observing the strong performance in the first half of the year, Republic Services raised its full-year adjusted EPS guidance to a $6.15 to $6.20 range. Following the initial stock price dip, RSG rebounded quickly, maintaining a positive momentum for the next six trading sessions.
The consensus opinion on RSG stock is moderately bullish, with an overall “Moderate Buy” rating. Out of the 21 analysts covering the stock, nine recommend a “Strong Buy,” one advises a “Moderate Buy,” and 11 suggest a “Hold” rating.
The mean price target of $216.37 suggests a potential upside of 5.2% from current price levels.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
