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RSG Q1 Earnings Beat Estimates on Pricing & Margin Gains
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Key Takeaways
RSG reported Q1 EPS of $1.70 and revenues of $4.11B, both beating consensus.
Republic Services delivered 5.7% core price growth and expanded the adjusted EBITDA margin 50 bps to 32.1%.
RSG generated $984M in adjusted free cash flow and returned $507M via repurchases and dividends in Q1.
Republic Services, Inc. (RSG - Free Report) delivered solid first-quarter 2026 results, with earnings per share of $1.70 beating the Zacks Consensus Estimate of $1.64 by 3.7%. Earnings increased 7.6% from $1.58 in the year-ago quarter.
Revenues rose 2.6% year over year to $4.11 billion and edged past the consensus mark of $4.10 billion. Disciplined pricing and cost management supported profitability, as the adjusted EBITDA margin expanded 50 basis points to 32.1%.
Republic Services, Inc. Price, Consensus and EPS Surprise
RSG’s Pricing Execution Stands Out Despite Volume Drag
Republic Services’ internal growth leaned heavily on price in the quarter. Core price on total revenues increased 5.7%, reflecting continued traction in open market pricing and restricted pricing, even as fuel recovery fees provided only a modest lift.
Volume remained a headwind, with total revenues declining 0.8% on volume, while average yield added 3.4%. Management noted that severe weather weighed on activity during the quarter, but pointed to sequential improvement in several verticals, including landfill and container-related lines.
Collection remained the largest contributor, generating $2.84 billion in revenues in the first quarter. Within the broader portfolio, small-container revenues rose to $1.31 billion, while large-container revenues came in at $768 million and residential revenues totaled $747 million, underscoring the scale of the core business.
Transfer revenues (net) increased to $200 million and landfill revenues (net) rose to $453 million. Environmental solutions revenues (net) declined to $405 million, while “other” revenues increased to $217 million, led by recycling processing and commodity sales of $112 million alongside other non-core revenues.
RSG Expands Segment Margins With Cost Discipline
Profitability improved across the consolidated model, supported by cost-control and underlying operating leverage. Net income was $525 million, translating to a net income margin of 12.8%, up from 12.3% a year ago.
On an adjusted basis, RSG reported $1.32 billion of adjusted EBITDA. By business type, Recycling & Waste produced adjusted EBITDA of $1.24 billion and an adjusted EBITDA margin of 33.6% compared with 33% in the prior-year quarter. Environmental Solutions generated adjusted EBITDA of $78 million with a margin of 19.2%, down from 20.8% last year, reflecting the year-over-year revenue decline in that business.
Republic Services’ Cash Flow Supports Capital Returns
RSG’s cash generation was a notable feature of the quarter. Cash provided by operating activities reached $1.23 billion, while the adjusted free cash flow totaled $984 million, up from $727 million in the year-ago period, aided by earnings growth and working capital timing.
The company continued to balance acquisition activity with shareholder returns. Cash invested in acquisitions was $433 million in the quarter, while total cash returned to shareholders was $507 million, including $314 million in share repurchases and $193 million in dividends. The board also declared a quarterly dividend of 62.5 cents per share, payable July 15, 2026.
Management emphasized continued investment in digital tools and sustainability initiatives aimed at supporting long-term growth and efficiency. On the earnings call, the company highlighted AI-enabled pricing, advanced routing and call-center tools, targeting at least $100 million of annual benefit by 2028, with pricing expected to contribute first as deployments scale.
RSG also reiterated progress in fleet electrification and renewable natural gas. The company ended the quarter with more than 200 electric collection vehicles in operation and expects to exceed 300 by year-end. In RNG, it brought nine projects online during 2025 and expects four additional projects to begin operations in 2026, expanding its landfill gas-to-energy portfolio to 82 projects.
Automatic Data Processing, Inc. (ADP - Free Report) posted third-quarter fiscal 2026 adjusted earnings per share of $3.37, beating the Zacks Consensus Estimate of $3.28 by 2.7%. The metric increased 10.1% from the year-ago quarter.
Total revenues came in at $5.94 billion, topping the consensus mark of $5.86 billion by 1.4% and rising 7% year over year. Operationally, Employer Services client revenue retention and overall client satisfaction reached record highs for the third quarter.
IQVIA Holdings Inc. (IQV - Free Report) posted first-quarter 2026 adjusted earnings of $2.90 per share, beating the Zacks Consensus Estimate of $2.83 by 2.5%. Revenues came in at $4.15 billion, topping the consensus mark of $4.08 billion by 1.6%.
Results improved year over year, with adjusted diluted earnings per share up 7.4% and revenues rising 8.4%.
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RSG Q1 Earnings Beat Estimates on Pricing & Margin Gains
Key Takeaways
Republic Services, Inc. (RSG - Free Report) delivered solid first-quarter 2026 results, with earnings per share of $1.70 beating the Zacks Consensus Estimate of $1.64 by 3.7%. Earnings increased 7.6% from $1.58 in the year-ago quarter.
Revenues rose 2.6% year over year to $4.11 billion and edged past the consensus mark of $4.10 billion. Disciplined pricing and cost management supported profitability, as the adjusted EBITDA margin expanded 50 basis points to 32.1%.
Republic Services, Inc. Price, Consensus and EPS Surprise
Republic Services, Inc. price-consensus-eps-surprise-chart | Republic Services, Inc. Quote
RSG’s Pricing Execution Stands Out Despite Volume Drag
Republic Services’ internal growth leaned heavily on price in the quarter. Core price on total revenues increased 5.7%, reflecting continued traction in open market pricing and restricted pricing, even as fuel recovery fees provided only a modest lift.
Volume remained a headwind, with total revenues declining 0.8% on volume, while average yield added 3.4%. Management noted that severe weather weighed on activity during the quarter, but pointed to sequential improvement in several verticals, including landfill and container-related lines.
Republic Services Posts Broad-Based Collection Growth
Collection remained the largest contributor, generating $2.84 billion in revenues in the first quarter. Within the broader portfolio, small-container revenues rose to $1.31 billion, while large-container revenues came in at $768 million and residential revenues totaled $747 million, underscoring the scale of the core business.
Transfer revenues (net) increased to $200 million and landfill revenues (net) rose to $453 million. Environmental solutions revenues (net) declined to $405 million, while “other” revenues increased to $217 million, led by recycling processing and commodity sales of $112 million alongside other non-core revenues.
RSG Expands Segment Margins With Cost Discipline
Profitability improved across the consolidated model, supported by cost-control and underlying operating leverage. Net income was $525 million, translating to a net income margin of 12.8%, up from 12.3% a year ago.
On an adjusted basis, RSG reported $1.32 billion of adjusted EBITDA. By business type, Recycling & Waste produced adjusted EBITDA of $1.24 billion and an adjusted EBITDA margin of 33.6% compared with 33% in the prior-year quarter. Environmental Solutions generated adjusted EBITDA of $78 million with a margin of 19.2%, down from 20.8% last year, reflecting the year-over-year revenue decline in that business.
Republic Services’ Cash Flow Supports Capital Returns
RSG’s cash generation was a notable feature of the quarter. Cash provided by operating activities reached $1.23 billion, while the adjusted free cash flow totaled $984 million, up from $727 million in the year-ago period, aided by earnings growth and working capital timing.
The company continued to balance acquisition activity with shareholder returns. Cash invested in acquisitions was $433 million in the quarter, while total cash returned to shareholders was $507 million, including $314 million in share repurchases and $193 million in dividends. The board also declared a quarterly dividend of 62.5 cents per share, payable July 15, 2026.
RSG Ramps Digital, Sustainability & Growth Investments
Management emphasized continued investment in digital tools and sustainability initiatives aimed at supporting long-term growth and efficiency. On the earnings call, the company highlighted AI-enabled pricing, advanced routing and call-center tools, targeting at least $100 million of annual benefit by 2028, with pricing expected to contribute first as deployments scale.
RSG also reiterated progress in fleet electrification and renewable natural gas. The company ended the quarter with more than 200 electric collection vehicles in operation and expects to exceed 300 by year-end. In RNG, it brought nine projects online during 2025 and expects four additional projects to begin operations in 2026, expanding its landfill gas-to-energy portfolio to 82 projects.
RSG carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot
Automatic Data Processing, Inc. (ADP - Free Report) posted third-quarter fiscal 2026 adjusted earnings per share of $3.37, beating the Zacks Consensus Estimate of $3.28 by 2.7%. The metric increased 10.1% from the year-ago quarter.
Total revenues came in at $5.94 billion, topping the consensus mark of $5.86 billion by 1.4% and rising 7% year over year. Operationally, Employer Services client revenue retention and overall client satisfaction reached record highs for the third quarter.
IQVIA Holdings Inc. (IQV - Free Report) posted first-quarter 2026 adjusted earnings of $2.90 per share, beating the Zacks Consensus Estimate of $2.83 by 2.5%. Revenues came in at $4.15 billion, topping the consensus mark of $4.08 billion by 1.6%.
Results improved year over year, with adjusted diluted earnings per share up 7.4% and revenues rising 8.4%.