US$237 - That's What Analysts Think Republic Services, Inc. (NYSE:RSG) Is Worth After These Results

It's been a good week for Republic Services, Inc. (NYSE:RSG) shareholders, because the company has just released its latest full-year results, and the shares gained 3.6% to US$231. The result was positive overall - although revenues of US$16b were in line with what the analysts predicted, Republic Services surprised by delivering a statutory profit of US$6.49 per share, modestly greater than expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Republic Services

Taking into account the latest results, the consensus forecast from Republic Services' 21 analysts is for revenues of US$16.9b in 2025. This reflects a credible 5.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to increase 4.1% to US$6.81. Before this earnings report, the analysts had been forecasting revenues of US$16.9b and earnings per share (EPS) of US$6.73 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 5.6% to US$237. It looks as though they previously had some doubts over whether the business would live up to their expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Republic Services at US$265 per share, while the most bearish prices it at US$176. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Republic Services shareholders.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Republic Services' revenue growth is expected to slow, with the forecast 5.5% annualised growth rate until the end of 2025 being well below the historical 11% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.8% per year. Factoring in the forecast slowdown in growth, it seems obvious that Republic Services is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Republic Services' revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Republic Services. Long-term earnings power is much more important than next year's profits. We have forecasts for Republic Services going out to 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Republic Services you should know about.

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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.