Momentum Stock Watch: Republic Services, Inc. (RSG)

Company Profile:

Republic Services, Inc., together with its subsidiaries, offers environmental services in the United States. The company offers collection and processing of recyclable materials, collection, transfer and disposal of non-hazardous solid waste, and other environmental solutions. Its collection services include curbside collection of material for transport to transfer stations, landfills, or recycling processing centers; supply of recycling and waste containers; and renting of compactors. In addition, the company engages in the processing and sale of old corrugated containers, old newsprint, aluminum, glass, and other materials; and provision of landfill and transfer services. Further, it offers disposal of non-hazardous solid and liquid material and in-plant services, such as transportation and logistics. It serves small-container, large-container, and residential customers. As of December 31, 2021, the company operated through 356 collection operations, 239 transfer stations, 198 active landfills, 71 recycling processing centers, 6 saltwater disposal wells, and 7 deep injection wells, as well as 3 treatment, recovery, and disposal facilities in 41 states. It also operated 77 landfill gas-to-energy and renewable energy projects and had 124 closed landfills. The company was incorporated in 1996 and is based in Phoenix, Arizona.

Recent News:

On Oct. 27, 2022, the company reported net income of $416.9 million, or $1.32 per diluted share, for the three months ended September 30, 2022, versus $350.3 million, or $1.10 per diluted share, for the comparable 2021 period. Excluding certain benefits and expenses, on an adjusted basis, net income for the three months ended September 30, 2022 was $425.4 million, or $1.34 per diluted share, versus $357.7 million, or $1.12 per diluted share, for the comparable 2021 period.

On Aug. 4, 2022, the company reported net income of $371.9 million, or $1.17 per diluted share, for the three months ended June 30, 2022, versus $331.1 million, or $1.03 per diluted share, for the comparable 2021 period. Excluding certain benefits and expenses, on an adjusted basis, net income for the three months ended June 30, 2022 was $418.4 million, or $1.32 per diluted share, versus $349.9 million, or $1.09 per diluted share, for the comparable 2021 period.

 

Fundamental Analysis:

Ninestocks analyzes several different financial aspects:

Price to Book Value – P/BV, a ratio used to compare book value to its current market price, to gauge whether a stock is valued properly.

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Price to Earnings – PE, the ratio for valuing a company that measures its current share price relative to its earnings per share (EPS).

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Discounted cash flow – DCF, a valuation method used to estimate the value of an investment based on its expected future cash flows.

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Return on Assets – ROA, indicates how profitable a company is in relation to its total assets, how efficiently uses assets to generate a profit.

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Return on Equity – ROE, a measure of financial performance calculated by dividing net income by equity. a gauge of profitability and efficiency.

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Debt to Equity – evaluate financial leverage, reflects the ability of equity to cover outstanding debts in the event of a business downturn.

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Conclusion:

RSG receives outperform rating in price to book value, price to earnings, discounted cash flow and debt to equity. Technical indicators signal the bullish signs, as there is a bullish crossover in the MACD and Stochastic oscillator. The RSI(14) stands at 52.5 with positive bias. We rate Republic Services, Inc. (RSG) a STRONG BUY.

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