Republic Services (RSG) Is Winning On Price While Volumes Slip

Republic Services (RSG) posted earnings of $1.84 per diluted share for the quarter ending June 30, marking a $0.09 increase from the same period a year ago. Despite a decline in volume, the company managed to lift most of its full-year targets. The key to this growth lies in pricing, which increased by 5.3% overall and contributed 4.1% in the restricted segment and 7.8% in the open market.

This price growth outpaced cost inflation, resulting in an adjusted EBITDA of $1.42 billion and a 32.1% margin. Cash generation was robust, with $2.38 billion produced in the first half of 2026 and $1.58 billion in adjusted free cash flow. The company returned $860 million to shareholders and bought $1.04 billion in acquisitions, distributing a $0.67 quarterly dividend.

Management raised revenue, adjusted EBITDA, and free cash flow guidance, and set adjusted earnings per share at $7.23 to $7.28. However, volume is moving in the opposite direction, contributing significantly to the decline in total revenue. The environmental solutions business and recycled commodities also performed poorly, affecting overall growth.

Despite this, 58 hedge funds hold Republic Services, indicating investor confidence, and the forward P/E of 27.03 suggests that the company's valuation relies heavily on sustained pricing power.