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RSG vs. WCN: Which Stock Is the Better Value Option?

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Investors interested in Waste Removal Services stocks are likely familiar with Republic Services (RSG - Free Report) and Waste Connections (WCN - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Currently, Republic Services has a Zacks Rank of #2 (Buy), while Waste Connections has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that RSG has an improving earnings outlook. But this is just one factor that value investors are interested in.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

RSG currently has a forward P/E ratio of 29.59, while WCN has a forward P/E of 40.42. We also note that RSG has a PEG ratio of 4.46. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. WCN currently has a PEG ratio of 4.70.

Another notable valuation metric for RSG is its P/B ratio of 3.51. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, WCN has a P/B of 4.03.

These are just a few of the metrics contributing to RSG's Value grade of B and WCN's Value grade of C.

RSG is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that RSG is likely the superior value option right now.


In-Depth Zacks Research for the Tickers Above


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Republic Services, Inc. (RSG) - free report >>

Waste Connections, Inc. (WCN) - free report >>

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