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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Republic Services, Inc. (XNYS:RSG) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
RSG
Name:
REPUBLIC SERVICES, INC. (XNYS:RSG)
Sector:
371.50M
Industry:
Waste Management
CEO:
Mr. Donald Slager
Total Employees:
35,000
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -90.29% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF REPUBLIC SERVICES, INC.(RSG) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND WASTE MANAGEMENT INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
142.79
One Month Price Target:
$143.36
Six Month Price Target :
$146.2
Likely Price in One Year's Time:
Ticker:
$149.61
Likely Trading Range Today Under (Normal Volatility)
$142.51
Price Upper limit ($) :
$143.31
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$138.09
This week:
$132.28
This month :
$121.77
Other Primary facts
Market Cap:
45.51B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
315.93M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
7.89%
-12.81%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$164.57
$154.40
$121.01
$131.18
Medium risk (<10%) entry points
Buy Call
Sell Call
$151.09
Buy Put:
Sell Put:
$148.92
$134.46
$136.66
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
RSG
Sharpe Ratio:
4.50%
Comparison:
RSG, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 86.28% higher than the industry
& ratio is 97.31% higher than the market/S&P 500 average
Average Returns/Yield of
RSG
Daily returns:
0.08%
Weekly returns:
0.41%
Monthly returns:
1.65%
Yearly returns:
15.29%
Comparison of returns:
Average annual returns/yield (last 3 years) is 29.87% above industry average
Classification:
RSG, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.27
Statistical test of Returns:
RSG has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
1.64%
Weekly Volatility:
3.67%
Monthly Volatility:
7.35%
Yearly Volatility:
25.45%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.90%
Volatility in last five trading days has been -44.98% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-3.29%
Weekly VaR:
-7.36%
Monthly VaR:
-14.72%
How Much Can the price of
RSG
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-12%
Worst case (decline):
-50.99%
This translates to price declining to:
$125.56
This translates to price declining to:
$69.97
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
RSG is a 3.90% riskier investment compared to the market/S&P 500 & is -10.99% less risky than Nasdaq(IXIC)
Risk (measured by volatility) is -38.49% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
RSG
Beta in relation to market/S&P 500--0.71
Expected beta in 1 year's time:
0.812
Expected beta in 3 year's time:
1.149
Unlevered (debt free) Beta:
0.375
Beta in relation to Nasdaq (XNAS):
0.525
Beta in relation to all global stocks::
0.608
Beta Comparison & Analysis
Beta of competitors/peers::
1.186
Beta is -40.05% lower than peers
Average Industry Beta:
1.031
Beta is -31.04% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
8.26%
Sustainable growth rate is -35.12% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.118
Alpha is 133.17% above industry average alpha yield
Alpha is 753% higher than market/& is unsustainably high
Analysis of Cost of Capital of
RSG
Equity cost of capital:
0.080
Equity cost of capital is -21.47% below industry mean WACC
Unlevered (without debt) cost of capital:
4.23%
Before-tax cost of debt:
-3.12%
After-tax cost of debt:
-2.47%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
-2.47%
WACC is -43.73% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$36.93
Revenue growth rate per share of (3Y):
5.02
Annual revenue growth rate is 52.73% above the industry average
EPS:
$4.22
Expected Annual growth rate of EPS (3Y):
6.55%
Expected future EPS growth rate is 51.23% higher than the Waste Management industry
Free cash flow (FCF) per share:
$4.70
Balance sheet equity growth per share: 22.65%
Equity growth rate per share is -202.50% lower than the industry
Debt per share
$31.16
EBITDA per share
$8.34
Valuation Analysis Today of
RSG
P/E Ratio:
32.73
P/E Ratio of Competitors/Peers:
25.93
P/E ratio is 26.21% higher than main peers & is 31.18% higher than the industry
Stock price/value with industry average P/E ratio: $105.29
RSG is 35.62% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $44.12
Present value of the expected future dividends only: $27.82
P/S (Price to Sales ratio):
3.87
Price to sales ratio is 60.20% above the industry mean
P/B (Price to book value ratio):
5.02
Price to free cash flow: 30.40
-
Net income growth rate (3Y):
27.85%
Net income growth rate is -55.08% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 10.82%
Dividend yeild: 1.29%
Previous Dividend: $0.46
Previous adjusted dividend: $0.46
Previous Dividend: $1.84
Expected next dividend best case: $0.48
Expected next dividend worst case: $0.44
Average dividend payment (long-term): $0.43
Average dividend increase/decrease (growth rate) % per period: 1.32%
Expected next dividend payment date: 13/10/2022
Expected next dividend record date: 29/09/2022
Expected next dividend declaration date: 08/03/2022
Previous dividend payment date: 15/07/2022
Previous dividend record date: 07/01/2022
Previous dividend declaration date: 05/05/2022
Dividend History:
2022-06-30--$0.46
2021-12-31--$0.46
2021-06-30--$0.43
2022-03-31--$0.46
2021-09-30--$0.46
2021-03-31--$0.43
Dividend growth rate is -110.33% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
109.56%
Net debt to equity ratio:
109.63%
Debt to assets ratio:
39.56%
Net debt to assets ratio:
39.59%
Debt-to-asset ratio is -35.74% below industry average
Ability to repay debt:
Interest coverage ratio:
-8.53
Interest coverage ratio is -180.91% less than industry average
Looking forward:
Debt growth rate:
4.23%
Annual debt growth is -60% lower than industry average debt growth rate
Debt repayment rate in last quarter: 5.66%
Analysis of Key Statistics
Correlation of price movement with the market:
0.738
Statistical significance of correlation:
RSG has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.559
Stock price is 32.03% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.559
Correlation of price movement with Nasdaq (^IXIC):
0.058
Covariance of price movement with the market:
0.055
Kurtosis
10.892
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.913
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
RSG
Gross Profit Margin Ratio:
161%
Operating Profit Margin Ratio:
18.38%
Operating profit margin is 216.99% higher than the industry
Net Profit Margin Ratio:
161%
Effective Tax Rate:
18.13%
Effective tax rate is -25.83% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
15.01%
Return on equity (ROE) is 29.37% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
5.42%
Return on assets (ROA) is 32.96% higher than the industry
Financial Leverage:
1.7x
Current Ratio:
0.75
Current ratio is -45.10% below industry average
Cash Conversion Cycle (days):
-8.2
Cash conversion cycle is -116.54% below industry average
-
Stock based compensation to net income ratio:
0.92%
In-depth Efficiency Analysis
Revenue generated per employee:
333.4K
Each employee generates 9% more revenue than industry average revenue per employee
EBITDA generated per employee:
75.3K
Each employee generates 26% more EBITDA than industry average revenue per employee
Profit generated per employee:
38.5K
Each employee generates 81% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
10.6K
Each employee generates 82% more free cash flow than industry average revenue per employee
Assets/Capital per employee
662.4K
Each employee generates 82% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
RSG
L3HARRIS TECHNOLOGIES, INC. (XNYS:LHX)
PARKER-HANNIFIN CORPORATION (XNYS:PH)
Enbridge Inc. (XNYS:ENBA)
CARRIER GLOBAL CORPORATION (XNYS:CARR)
Trane Technologies plc (XNYS:TT)
FERGUSON PLC (XNYS:FERG)
ROCKWELL AUTOMATION, INC. (XNYS:ROK)
ROPER TECHNOLOGIES, INC. (XNYS:ROP)
TRANSDIGM GROUP INCORPORATED (XNYS:TDG)
Current Analyst Ratings
Strong buy�8%
Buy�8%
Hold�33%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
11.67B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
6.97B
4.70B
-
896.80M
1.23B
-
31.80M
1.26B
1.70M
- 308900.00K
1.30B
2.64B
2.14B
1.35B
1.65B
298.60M
1.35B
Statement of Cash Flow
Date:
Period:
332.10M
Differed Income Tax :
24.90M
Stock Based Compensation :
12.40M
Change in Working Capital :
- 29500.00K
Accounts Receivables:
- 38400.00K
Other Working Capital:
-
Other Non-Cash Items:
13.80M
Net Cash Provided by Operating Activities:
705.60M
Investments in PP&E:
- 334100.00K
Net Acquisitions:
- 81600.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
39.00M
-
39.00M
1.47B
80.50M
103.10M
1.70B
9.44B
12.83B
258.00M
134.30M
-
520.10M
23.18B
-
24.88B
846.60M
45.10M
158.40M
408.20M
958.20M
2.26B
9.84B
2.54B
13.64B
-
15.90B
3.20M
6.68B
- 13500.0K
2.31B
March 31, 2022 at 6:00:00 AM
8.23B
8.98B
24.88B
-
9.89B
9.8B
-
16.30M
- 399400.00K
- 590900.00K
-
- 215000.00K
- 145900.00K
637.10M
- 314700.00K
-
- 8500.00K
97.10M
105.60M
705.60M
- 334100.00K
371.50M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
RSG
2023
2024
2025
2026
2027
$159.45
$167.07
$175.05
$183.42
$192.19