• Wondering if Republic Services at around US$208 per share offers good value, or if the recent price leaves little margin for error?
• The stock has risen 4.1% over the last week and 0.3% over the last month, yet is still down 0.9% year to date and has fallen 15.0% over the past year, even after rising 48.7% over three years and 102.8% over five years.
• Recent news coverage has focused on Republic Services as a large US waste management and recycling company, highlighting its role in essential services such as municipal collection and landfill operations. This context helps frame why the stock can sometimes move differently from more cyclical sectors, even when shorter term returns are mixed.
• Republic Services currently holds a valuation score of 2 out of 6. The next step is to walk through how different valuation methods assess the stock and then finish with a way to pull those methods together into a clearer overall view.

Republic Services scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Republic Services Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a stock could be worth today by projecting the company’s future cash flows and discounting them back into today’s dollars.

For Republic Services, the model uses a 2 Stage Free Cash Flow to Equity approach built on cash flow projections in $. The latest twelve month free cash flow is about $2.6b. Analyst inputs and subsequent extrapolations in this model point to projected free cash flow of roughly $3.3b by 2030, with intermediate annual projections between 2026 and 2035 feeding into the valuation.

Pulling these cash flows together and discounting them back gives an estimated intrinsic value of about $244.01 per share. Against a recent share price around $208, this DCF output suggests the stock is trading at roughly a 14.6% discount to this intrinsic value under the assumptions used in the model.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Republic Services is undervalued by 14.6%. Track this in your watchlist or portfolio, or discover 51 more high quality undervalued stocks.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Republic Services.

Approach 2: Republic Services Price vs Earnings

For a consistently profitable company, the P/E ratio is a useful shorthand for how much investors are paying for each dollar of earnings. It is simple to compare across time and against other stocks, and it ties directly to what ultimately matters, the earnings that support the share price.

What counts as a “normal” P/E depends on how the market views a company’s growth prospects and risks. Higher expected growth or lower perceived risk can justify a higher multiple, while slower growth or higher risk often comes with a lower P/E.

Republic Services currently trades on a P/E of about 29.5x. That sits above the wider Commercial Services industry average of roughly 21.5x, yet below the peer group average around 34.9x. Simply Wall St’s Fair Ratio metric for Republic Services is 26.0x. This is a proprietary estimate of what the P/E “should” be, given factors such as earnings growth, profit margins, industry, market cap and company specific risks, which makes it more tailored than a simple comparison to peers or the broad industry.

With the actual P/E of 29.5x sitting above the Fair Ratio of 26.0x, the multiple approach points to the stock looking overvalued on earnings.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your Republic Services Narrative

Earlier it was mentioned that there is an even better way to understand valuation. Meet Narratives, a simple tool on Simply Wall St’s Community page that lets you link your view of Republic Services’ story, such as how electric collection fleets, recycling automation, renewable natural gas projects and acquisitions could affect revenue, earnings, margins and risks, to a concrete forecast and fair value. You can then compare that fair value to today’s price to help inform a decision to buy, hold or sell, with the numbers updating automatically as fresh news or earnings arrive. This is why some investors currently see the stock closer to US$270 while others anchor their view nearer to US$200, based on different assumptions and levels of comfort with the uncertainties described above.

Do you think there's more to the story for Republic Services? Head over to our Community to see what others are saying!

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

Disclaimer:This article represents the opinion of the author only. It does not represent the opinion of Webull, nor should it be viewed as an indication that Webull either agrees with or confirms the truthfulness or accuracy of the information. It should not be considered as investment advice from Webull or anyone else, nor should it be used as the basis of any investment decision.