Morgan Stanley Reiterates Overweight on Republic Services (RSG)

Morgan Stanley is out with its report today on Republic Services RSG, reiterating Overweight. In a note to clients, Morgan Stanley writes, "In September 2010 we wrote about the impact of the consumer price index on Republic Services, concluding the CPI would soon become a tailwind for pricing. Since then, CPI readings have exceeded expectations and Morgan Stanley's economics team has raised its forecasts. Our updated analysis shows the lagged benefit is increasingly supportive of price increases, just as volumes are ready to turn positive for the first time since 2006. We reiterate our Overweight on Republic Services with shares still the cheapest among the waste services peers and with the company poised to generate $900 million in free cash flow this year." Morgan Stanley maintains a $38 PT on RSG. Shares of RSG closed Monday at $32.30, down 0.19% from Friday's close.