Republic Services, Inc.
RSGRepublic Services is a leading provider of non-hazardous solid waste collection, transfer, and disposal services in North America.
It is an industry leader known for its extensive network of landfills and recycling facilities, positioning it for stable, recurring revenue.
Updated: February 19, 2026, 16:00 EST
Investment Opinion: Should I buy RSG Today?
Technical Analysis
RSG has demonstrated impressive recent momentum, significantly outperforming the market over the past three months with notably low volatility. Currently positioned in the lower third of its 52-week range, the stock appears to be in a recovery phase rather than being overbought. This combination of relative strength and defensive characteristics suggests positive technical momentum.
Fundamentals
The company maintains solid profitability with a net margin exceeding 13%, though Q4 revenue showed a slight sequential decline. RSG's financial health is strong with minimal debt, providing stability, but operational metrics like ROE and asset turnover indicate there's room for improved capital efficiency. Overall, the fundamental picture shows a stable, profitable business with a clean balance sheet.
Valuation & Risk
RSG trades at premium valuation multiples, with P/E ratios above 30 and a very high EV/EBITDA, suggesting the market has priced in significant future growth. The primary risk is sector-specific downturns, as evidenced by the stock's 20% maximum drawdown, though its low beta provides defensive characteristics. Without industry comparison data, it's challenging to determine if the current premium is justified.
Investment Recommendation
Consider Buying. RSG presents a compelling case as a high-quality company showing technical recovery momentum and strong fundamental health. While the valuation is premium, it may be justified by the company's defensive characteristics, profitability, and growth prospects. Investors seeking a stable, low-volatility stock with recovery potential may find RSG attractive, though should monitor execution against growth expectations given the elevated multiples.
*Note: This is not investment advice, for reference only.*
RSG 12-Month Price Forecast
RockFlow Model Forecast: Three Scenarios for 2026
Based on the provided analysis, here is a 12-month outlook for RSG:
12-Month Outlook for RSG
The 12-month outlook is cautiously optimistic, supported by the stock's strong technical recovery momentum and the company's solid profitability and debt-free balance sheet. Key catalysts will be the company's ability to demonstrate improved revenue growth and operational efficiency to justify its premium valuation. The primary risk remains a broader sector downturn, which could test the stock's defensive characteristics and amplify downside volatility given its high starting valuation multiples. While a specific analyst target is unavailable, the positive technical setup and fundamental strength suggest potential for moderate upside, contingent on the company meeting growth expectations.
Wall Street Consensus
Most Wall Street analysts are optimistic about Republic Services, Inc.'s 12-month outlook, with consensus target around $221.63, indicating expected upside potential.
Bulls vs Bears: RSG Investment Factors
Overall, RSG has investment potential but also faces challenges. Here are key factors to weigh before investing.
Bullish
- Strong Institutional Buying: JPMorgan and TCW Group recently increased their positions significantly.
- Insider Confidence: A director purchased $100,121 worth of stock, showing belief in the company.
- Leading Market Position: Company is a top provider in the essential waste management industry.
- Long-Term Price Appreciation: Stock has surged 140% over the past five years.
Bearish
- Valuation Concerns: Stock may be overvalued after its multi-year surge to ~$212.
- Recent Underperformance: Minimal net gains versus the S&P 500 over the past year.
- Sector Pressure: Q3 performance may lag behind other waste management stocks.
- Price Volatility: Experienced significant price swings recently.
RSG Technical Analysis
RSG has demonstrated solid outperformance against the market over the past three months while maintaining relatively low volatility. The stock is currently positioned in the lower third of its 52-week range, suggesting potential recovery potential after experiencing a significant decline from its peak.
Over the short term, RSG gained 4.93% in one month and 6.79% over three months, significantly outpacing the broader market by 6.81% during the latter period. This recent strength, combined with a low beta of 0.55, indicates the stock has delivered strong risk-adjusted returns with less volatility than the overall market.
Currently trading at $221.19, RSG sits approximately 14.5% above its 52-week low but remains 14.5% below its 52-week high, placing it in the lower portion of its annual range. Given the 20.91% maximum drawdown from the high, the stock appears to be in a recovery phase rather than overbought territory.
| Period | RSG Return | S&P 500 |
|---|---|---|
| 1m | +5.2% | +1.0% |
| 3m | +7.6% | +1.9% |
| 6m | -5.1% | +6.5% |
| 1y | -4.0% | +12.1% |
| ytd | +5.4% | +0.2% |
RSG Fundamental Analysis
Revenue & Profitability RSG's Q4 revenue of $4.14 billion declined slightly from Q3's $4.21 billion, though the company maintained solid profitability with a net profit margin of 13.2%. Operating income ratio improved to 19.1% from 19.8% in Q3, reflecting stable operational efficiency despite the revenue dip.
Financial Health The company maintains a strong balance sheet with minimal leverage, evidenced by a low debt ratio of 1.7% and debt-to-equity ratio of 5.0%. However, cash position appears limited with a cash ratio of just 1.9%, though the absence of significant debt obligations provides financial flexibility.
Operational Efficiency RSG's operational metrics show moderate efficiency with an ROE of 4.6% and asset turnover of 0.12, indicating room for improvement in capital utilization. The 41-day cash conversion cycle suggests reasonable working capital management, though fixed asset turnover of 0.33 points to potential underutilization of long-term assets.
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Based on the provided metrics, RSG appears to be trading at a premium valuation. The company's trailing and forward P/E ratios are both above 30, which indicates a high earnings multiple. Furthermore, the significantly elevated EV/EBITDA ratio of 75.5 suggests the market is pricing in substantial future growth or profitability improvements.
A direct peer comparison cannot be performed as industry average data is unavailable. This lack of context makes it difficult to definitively assess whether RSG's valuation multiples are justified relative to its sector. The analysis would be significantly strengthened by benchmarking these metrics against industry norms for waste management or environmental services companies.
Investment Risk Disclosure
Volatility Risk: With a beta of 0.554, RSG exhibits significantly lower volatility than the broader market, indicating defensive characteristics. However, the one-year maximum drawdown of -20.91% underscores its susceptibility to sector-specific downturns, implying that while it may be less volatile on a day-to-day basis, it can still experience significant price declines during adverse market conditions for its industry.
Other Risks: The absence of notable short interest suggests a general market consensus on the stock's valuation or fundamentals, reducing the risk of a short squeeze but not eliminating fundamental business risks. Investors should focus on operational execution, regulatory changes, and liquidity as the primary non-volatility concerns given the lack of speculative pressure from short sellers.
FAQs
Bullish. Strong institutional and insider buying signals confidence in its leading market position, while low volatility (beta 0.55) and solid profitability (13.2% net margin) support stability. The stock trades 14.5% below its 52-week high, offering recovery potential. Best suited for long-term investors comfortable with premium valuation multiples.
Based on the provided metrics, RSG appears moderately overvalued. Its P/E ratio of 32.5 and P/B ratio of 5.8 are substantially elevated compared to typical industrial sector averages (usually below 20 for P/E and 3 for P/B), indicating the market is pricing in strong future growth. Key valuation metrics showing premium levels include the high P/E, elevated P/B, and P/S ratio of 3.6. This valuation seems to reflect expectations for continued premium profitability (13.2% net margin) and growth potential, despite current operational metrics like ROE of 4.6% suggesting more modest capital efficiency.
Based on the provided information, here are the key risks of holding RSG stock, ordered by importance:
1. Market/Sector Risk: Despite its low volatility (beta of 0.55), the stock is susceptible to significant sector-specific downturns, as evidenced by its substantial 20.91% maximum drawdown from its 52-week high. 2. Operational Efficiency Risk: The company's low Return on Equity (4.6%) and asset turnover ratios (0.12) indicate potential inefficiency in utilizing its capital and assets to generate profits. 3. Liquidity Risk: RSG maintains a very low cash ratio of 1.9%, which could limit its financial flexibility to handle unexpected expenses or economic disruptions despite its low debt levels.
Based on the current data, here is a forecast for RSG stock through 2026:
For 2026, our base case target price is $245-$260, with a bull case scenario of $280+, assuming an annualized return of 3-6% from the current price.
Key growth drivers include sustained profitability from operational efficiency, strategic capital deployment using its debt-free balance sheet for acquisitions or shareholder returns, and resilience to economic downturns due to its essential waste services.
Our main assumptions are that RSG maintains its net profit margin above 13%, continues its prudent financial management with low leverage, and successfully navigates any sector-wide pressures. A primary uncertainty is the company's ability to reignite consistent revenue growth to justify its valuation premium, as a prolonged slowdown could limit upside potential. This forecast is inherently uncertain and subject to broader market conditions and execution risks.