Trash Hauler Republic Services Beats Estimates

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Trash collector and recyclerRepublic Services ( RSG ) rose sharply Friday after reporting better-than-expected earnings and raising its dividend.

The U.S. No. 2 trash hauler afterWaste Management ( WMT ), Republic reported earnings of 51 cents a share vs. estimates of 49 cents. That's a 19% increase from a year ago. Revenue was $2.23 billion, a 5% increase. The company attributed the earnings boost to productivity gains and the revenue to more volume hauled.

The company serves 13 million customers nationwide, including residences, businesses, industries and municipalities.


Republic was incorporated in 1998 and grew through acquisitions and mergers as well as organically. The stock also came public in 1998. The stock lost more than half its value in the 2008 financial crisis, but has worked its way back to just above its former high. The last few years has seen spotty EPS growth and mostly a sideways stock. Revenue growth has been low single digits.

The Pollution Control industry group is ranked No. 127 out of 197 industry groups. Republic is ranked 8th out of 33 by Composite Rating.

The company also raised its quarterly dividend from 26 to 28 cents. That works out to an annual yield of 3%. The dividend will be paid Oct. 15 to shareholders of record Oct. 1. The company has a history of raising its dividend. It was paying 6 cents in 2003.

The company has a five-year annualized EPS growth rate of 7% and an Earnings Stability Factor of 6 on a 0 to 99 scale, where low numbers correspond to stable earnings growth.

Analysts expect a 4% decline in earnings in the next report and a 1% decline overall for the year. They expect 10% growth in 2015.

Investment firm Cascade Investment, controlled by Bill Gates, bought 1.4 million shares of Republic stock in June.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Personal Finance , Investing Ideas

Referenced Stocks: RSG , WMT

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