Wolfe Research initiated coverage of Republic Services with a Peer Perform rating as part of a broader research note on Environmental Services. The sector has clear historical outperformance during downturn and offers attractive barriers to entry and pricing power, with smaller players able to grow via M&A, the analyst tells investors in a research note, adding that the firm sees resilient pricing power and incremental upside from recycling, automation, and cost cutting. The company also offers defensive earnings, with steady revenue and free cash flow growth, though the firm sees limited growth opportunities that move the needle given its large size, Wolfe added.
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