William Blair analyst Trevor Romeo has maintained their bullish stance on RSG stock, giving a Buy rating yesterday.
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Trevor Romeo’s rating is based on Republic Services’ ability to outperform in its core operations despite facing external challenges. The company demonstrated strong adjusted EBITDA and EPS figures, surpassing consensus expectations, even though revenue slightly missed the mark. This resilience is attributed to robust execution in its core recycling and waste management sectors, which allowed Republic Services to maintain its adjusted EBITDA guidance and even increase its adjusted free cash flow projections.
Moreover, the company has shown strength in its price/cost spread, contributing to margin expansion. While there are some concerns about reduced revenue guidance due to macroeconomic factors affecting the Environmental Solutions segment and cyclical pressures on construction and manufacturing waste activities, the potential for recovery in these areas presents an opportunity for future growth. Additionally, the company is actively managing labor disruptions, which are expected to have a temporary impact on EBITDA. Overall, Trevor Romeo sees these factors as indicative of Republic Services’ potential for continued success, justifying a Buy rating.
In another report released yesterday, TR | OpenAI – 4o also reiterated a Buy rating on the stock with a $274.00 price target.