Republic Services, Inc. (NYSE:RSG) Analysts Are Pretty Bullish On The Stock After Recent Results

Republic Services, Inc. (NYSE:RSG) came out with its annual results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Republic Services reported US$15b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$5.47 beat expectations, being 2.5% higher than what the analysts expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Republic Services

Taking into account the latest results, the current consensus from Republic Services' 19 analysts is for revenues of US$16.2b in 2024. This would reflect a notable 8.1% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to increase 7.9% to US$5.94. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$15.8b and earnings per share (EPS) of US$5.89 in 2024. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a slight bump in to revenue forecasts.

The consensus price target increased 12% to US$194, with an improved revenue forecast carrying the promise of a more valuable business, in time. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Republic Services, with the most bullish analyst valuing it at US$215 and the most bearish at US$143 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 8.1% growth on an annualised basis. That is in line with its 8.9% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 6.7% per year. So although Republic Services is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Republic Services going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Republic Services that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.