Republic Services' second-quarter results were in line with the themes affecting the waste industry. Core pricing gains and fuel surcharges support yields and margins, while volume remains a headwind. The firm reported adjusted EPS of $1.85 per share, up 4.5% year over year.
Republic’s traditional solid waste operations should continue to perform well due to solid execution and strong pricing. The average life of Republic’s landfill portfolio is 56 years, which is much higher than its peers.
The acquisition of US Ecology and future acquisitions could underperform the firm’s expectations, resulting in value destruction. Republic trades at a rich multiple, and its record margins may face downward pressure as pricing normalizes.
|
Metric
|
RSG
|
WCN
|
WM
|
|---|---|---|---|
Price/Earnings (Normalized) | 29.77 | 30.45 | 29.02 |
Price/Book Value | 5.46 | 5.29 | 9.05 |
Price/Sales | 3.94 | 4.36 | 3.53 |
Price/Cash Flow | 13.85 | 15.28 | 13.25 |
|
Metric
|
RSG
|
WCN
|
WM
|
|---|---|---|---|
Quick Ratio | 0.58 | 0.55 | 0.80 |
Current Ratio | 0.64 | 0.66 | 0.91 |
Interest Coverage | 5.32 | 4.91 | 5.00 |
|
Metric
|
RSG
|
WCN
|
WM
|
|---|---|---|---|
Return on Assets (Normalized) | 6.53% | 6.65% | 7.34% |
Return on Equity (Normalized) | 18.66% | 17.20% | 34.59% |
Return on Invested Capital (Normalized) | 10.61% | 9.57% | 12.35% |
|
1-Day Chart
|
Name
|
Price
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|---|
| Waste Management Inc
WM
| LOCK|d%&Zm& | LOCK|jh | $90B | |||
| Waste Connections Inc
WCN
| LOCK|cl%xhQ | LOCK|rvs | $42B | |||
| Veolia Environnement SA
VEOEF
| — | LOCK|LrW$ | $29B | |||
| Veolia Environnement SA ADR
VEOEY
| LOCK|GnZn?B | LOCK|b&vFb | $29B | |||
| Clean Harbors Inc
CLH
| LOCK|WK?yNZ | LOCK|??#>v | $17B | |||
| GFL Environmental Inc
GFL
| — | LOCK|q>%tH | $15B | |||
| Umicore SA Ordinary Shares
UMICF
| — | LOCK|jk | $7B | |||
| Umicore SA ADR
UMICY
| — | LOCK|lJ | $7B | |||
| Fomento de Construcciones y Contratas SA
FMOCF
| — | LOCK|Hv$ | $6B |
United States