April 27, 2025 a 03:31 pm
RSG: Dividend Analysis - Republic Services, Inc.
Republic Services, Inc. presents a nuanced dividend profile with a modest yield supported by consistent historical payouts. However, the recent history of dividend cuts and marginal growth over the past five years presents a mixed picture for potential investors. This analysis will delve into the key financial metrics driving Republic Services' dividend strategy.
Overview 📊
Republic Services operates within the Waste Management sector, providing an essential service with stable demand. The dividend yield, currently at 0.95%, alongside a dividend payout of $2.19 per share, reflects a cautious distribution policy. With over two decades of dividend history and a recent suspension, prospects remain uncertain under fiscal constraints.
| Metric | Data |
|---|---|
| Sector | Waste Management |
| Dividend Yield | 0.95% |
| Current Dividend Per Share | $2.19 |
| Dividend History (Years) | 23 years |
| Last Cut or Suspension | 2024 |
Dividend History 🗣️
The dividend history denotes long-term reliability, yet recent fluctuations and the cut in 2024 underscore potential volatility.
This visual represents Republic Services' dividend journey, highlighting both stability and recent disruptions.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 1.74 |
| 2024 | 1.65 |
| 2023 | 2.06 |
| 2022 | 1.91 |
| 2021 | 1.77 |
Dividend Growth 📈
Republic Services has seen limited growth in dividend payouts, reflecting financial prudence yet a lack of positive momentum.
| Time | Growth |
|---|---|
| 3 years | -2.31% |
| 5 years | 1.13% |
The average dividend growth is 1.13% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio ✅
Analyzing the payout ratio reveals a conservative approach, affording Republic Services both stability and growth potential.
| Key Figure | Ratio |
|---|---|
| EPS-based | 32.82% |
| Free cash flow-based | 29.05% |
These payout ratios suggest a strong coverage, reflecting a disciplined approach to dividend distribution, substantial enough for reinvestment while rewarding shareholders.
Cashflow & Capital Efficiency 📉
Critical metrics reveal Republic Services' capital allocation efficiency, ensuring robust cash flow coverage for dividends.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 3.29% | 3.81% | 4.25% |
| Earnings Yield | 3.23% | 3.32% | 3.64% |
| CAPEX to Operating Cash Flow | 43.37% | 45.09% | 45.58% |
| Stock-based Compensation to Revenue | 0.27% | 0.27% | 0.29% |
| Free Cash Flow / Operating Cash Flow Ratio | 52.87% | 54.91% | 54.42% |
The metrics indicate thorough capital efficiency, suggesting a stable foundation for sustaining dividends.
Balance Sheet & Leverage Analysis 📊
Key leverage ratios affirm financial stability, essential for long-term dividend assurance.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 0.076 | 1.240 | 1.217 |
| Debt-to-Assets | 2.66% | 41.61% | 40.57% |
| Debt-to-Capital | 7.03% | 55.35% | 54.89% |
| Net Debt to EBITDA | 0.074 | 2.993 | 3.181 |
| Current Ratio | 0.665 | 0.563 | 0.696 |
| Quick Ratio | 0.583 | 0.540 | 0.667 |
| Financial Leverage | 2.84 | 2.98 | 3.00 |
The balance sheet depicts prudent leverage management, a positive signal for maintaining dividend payments under various economic conditions.
Fundamental Strength & Profitability 📉
Investment returns and margin analysis underline Republic Services’ aggressive profitability measures.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 17.91% | 16.42% | 15.36% |
| Return on Assets | 6.31% | 5.51% | 5.12% |
| Margins: Net, EBIT, EBITDA, Gross | 12.74%, 18.53%, 29.66%, 41.68% | 11.57%, 18.04%, 28.87%, 40.24% | 11.01%, 16.48%, 27.08%, 39.28% |
| R&D to Revenue | 0.00% | 0.00% | 0.00% |
The metrics highlight a consistently strong profitability, supporting the company's capability to pay dividends and sustain earnings growth.
Price Development 🌟
Tracking the stock price development offers insights into market perceptions and potential investor interest in Republic Services.
Dividend Scoring System 📊
| Criteria | Score | Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 4 | |
| Dividend growth | 2 | |
| Payout ratio | 5 | |
| Financial stability | 4 | |
| Dividend continuity | 3 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 3 |
Total Score: 28 out of 40
Rating 🏆
In summary, Republic Services, Inc. maintains a strong dividend strategy anchored by sound financial practices. Despite recent cuts and modest growth, the company's foundation positions it well for income-focused investors seeking stability with room for cautious optimism in its recovery path.