Republic Services (RSG): Evaluating Valuation Following Labor Settlement and Fresh Union Contract

Republic Services (RSG) resolved a widespread labor dispute after 2,000 workers returned to their jobs with a new contract in place. This agreement delivers notable wage hikes and enhanced benefits. It also provides clarity on future costs for investors.

See our latest analysis for Republic Services.

Shares of Republic Services have been remarkably resilient, especially in the wake of the recent strike. With the labor dispute now settled and a regular dividend affirmed, investors have seen a 1-year total shareholder return of nearly 12%, and a robust 3-year total return approaching 72%. Recent momentum has been a bit soft. However, the company's long-term track record underscores its ability to turn short-term disruptions into opportunities for steady growth.

If you’re interested in seeing what other steady growers are out there, now could be the perfect moment to discover fast growing stocks with high insider ownership.

With the contract disputes resolved, Republic Services is back on track. However, with the stock holding near highs, investors must now ask whether today’s price offers a genuine buying opportunity or if future gains are already built in.

Most Popular Narrative: 13% Undervalued

At $223.11 per share, Republic Services trades about 13% below the widely followed narrative’s fair value estimate. The story behind this gap stems from aggressive long-term profit expansion and new earnings drivers just starting to materialize.

Sustainability efforts such as the development of Polymer Centers and the Blue Polymers joint venture could drive future revenue growth by enhancing plastic circularity and decarbonization. These operations are expected to contribute to earnings starting in the second half of 2025.

Read the complete narrative.

Want to know what is behind the numerical optimism? Forward-looking profit assumptions, ambitious revenue milestones, and a bold future profit multiple are hidden at the heart of this narrative. Curious which big financial projections support such a premium? Uncover the full breakdown that underpins this fair value.

Result: Fair Value of $256.68 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, key risks remain, including ongoing softness in construction volumes and potential integration hurdles arising from Republic Services’ aggressive acquisition strategy.

Find out about the key risks to this Republic Services narrative.

Build Your Own Republic Services Narrative

Prefer a different perspective, or want to dig into the numbers yourself? Craft your own Republic Services analysis in just a few minutes by using Do it your way.

A great starting point for your Republic Services research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

Looking for More Investment Ideas?

Why limit yourself to just one stock? Uncover game-changing opportunities by using Simply Wall Street’s powerful screener. Your next winner could be just a click away.

• Tap into market momentum and unlock potential by checking out these 875 undervalued stocks based on cash flows companies that may be trading for less than they're really worth.
• Boost your portfolio’s income stream, starting with these 17 dividend stocks with yields > 3%, featuring stocks offering attractive yields above 3%.
• Get ahead of the curve and target future tech leaders by reviewing these 27 AI penny stocks reshaping industries through artificial intelligence.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com