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Shares of Republic Services Inc RSG were <a href="https://www.benzinga.com/quote/RSG">climbing in early trading on Thursday</a>.



The stock is trading at a discount of around 10% to its direct Solid Waste peers, while the company's growing Environmental Services platform has the potential for margin expansion, according to Truist Securities.



The Republic Services Analyst: Tobey Sommer upgraded the rating Republic Services for from Hold to Buy, while raising the price target from $192 to $220.



The Republic Services Thesis: While the company&#8217;s Environmental Services segment offers pricing-led growth, there are opportunities for accretive mergers and acquisitions (M&amp;As), Sommer said in the upgrade note.



Check out <a href="https://www.benzinga.com/analyst-stock-ratings">other analyst stock ratings</a>.



Republic Services could execute to $500 million in annual solid waste M&amp;A spend over the next eight to 10 years, Sommer added.



"We see additional opportunity adding to the growing ES platform with an estimated ~$18B in private ES revenues," the analyst wrote. The company is likely to raise its 2024 guidance when it announces its second-quarter earnings next month, he said.



"Leverage has now declined to 2.8x, the lowest in the group, and we believe the company has a wide pipeline of accretive tuck-in opportunities in Solid Waste, Recycling and Environmental Services," Sommer further stated.



RSG Price Action: Shares of Republic Services had risen by 0.67% to $198.20 at the time of publication on Thursday.



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Analyst Ratings

Truist Securities upgraded Republic Services to Buy and raised the price target to $220, citing growth potential and M&A opportunities.

Republic Services Has A 'Wide Pipeline Of Accretive Tuck-In Opportunities,' Says Bullish Analyst - Republic Servs (NYSE:RSG)

Priya Nigam

Republic Servs

Tobey Sommer

Truist Securities

Republic Services Has A 'Wide Pipeline Of Accretive Tuck-In Opportunities,' Says Bullish Analyst

Republic Services Inc

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