Reasons Why You Should Retain RSG Stock in Your Portfolio Now

Republic Services, Inc. RSG is gaining from continued demand for its essential waste services across North America. The company’s disciplined pricing strategies and robust Collection segment growth fuel its long-term prospects. Increased sustainable investments in artificial intelligence (AI) and shareholder-friendly policies increase the stock’s appeal to investors.

The company’s third-quarter 2026 earnings are expected to increase 1.1% year over year. Earnings for 2026 and 2027 are projected to rise 3.6% and 10.1% year over year, respectively. Revenues are expected to increase 4% in 2026 and 5.4% in 2027.

Factors That Bode Well for RSG

Republic Services benefits from the sustained demand in the North American solid waste management market. The surge in the urban population across the United States and Canada is further amplifying solid waste production. Rapid adoption of zero-waste initiatives and industrial growth across the region are boosting demand for commercial and industrial waste solutions, allowing RSG to maintain stable revenue generation.

Republic Services, Inc. Revenue (TTM)

Republic Services, Inc. revenue-ttm | Republic Services, Inc. Quote

The company’s focused pricing strategies are boosting customer service and operational efficiency. During the second quarter of 2026, the company reported that core price for related business revenues rose 6.4%, including 7.8% open-market pricing and 4.1% restricted pricing.

The collection segment remains the top contributor to RSG’s top-line growth. Higher waste generation further supports collection frequency and service demand over time. RSG’s Collection revenues rose 6% year over year during the second quarter of 2026.

RSG is deploying AI-powered predictive pricing tools to optimize pricing decisions across different markets, while supporting customer retention and reducing attrition. Early pilots of AI-enabled routing are confirming expected benefits, while predictive pricing tools are designed to improve price retention and reduce customer attrition. Recently, management stated that two renewable natural gas projects began operations during the second quarter of 2026, with two more expected by year-end.

Republic Services has demonstrated a strong commitment to its shareholders through consistent dividend payments and share repurchases. In 2023, 2024 and 2025, the company paid $650 million, $687 million and $738 million in dividends, while repurchasing shares worth $261.8 million, $482 million and $870 million, respectively. This consistency underscores its dedication to creating long-term value for investors.

Watch Out for These Risks to RSG Stock

Republic Services faces stiff competition from waste management companies such as Veralto Corporation and Clean Harbors, multiple municipalities and several other regional and smaller companies in the waste industry. This puts pressure on the company to continually innovate and differentiate its offerings while maintaining cost efficiency, which increases the challenge of balancing growth and profitability.

RSG's weak liquidity also remains a concerning factor for investors. Its current ratio (a measure of liquidity) at the end of the second quarter of 2026 was 0.64, lower than the industry average of 1.02. A current ratio of less than 1 implies that the company may face challenges in meeting its short-term obligations.

Republic Services currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stocks to Consider

A couple of better-ranked stocks in the Business Services sector are Bright Horizons Family Solutions Inc. BFAM and CBIZ, Inc. CBZ.

Bright Horizons Family Solutions carries a Zacks Rank #2 (Buy) at present. It has a long-term earnings growth expectation of 13.9%.

BFAM delivered a trailing four-quarter earnings surprise of 7.6%, on average.

CBIZ also holds a Zacks Rank of 2 at present. It has a long-term earnings growth expectation of 11.6%.

CBZ beat earnings estimates in three of the last four quarters and missed once, with an average earnings surprise of 8.9%.

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This article originally published on Zacks Investment Research (zacks.com).

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