RSG
Republic Services, Inc.
$216.88
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 72.5% above fair value
You pay
$216.88
Bear
$91.11
Fair
$125.70
Bull
$157.67
Bear
$91.11
-58.0%
5% stage 1 growth, 11% discount
Fair
$125.70
-42.0%
8% stage 1 growth, 11% discount
Bull
$157.67
-27.3%
10% stage 1 growth, 11% discount
Adjust Assumptions
7.7%
11.0%
3.0%
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
37%
Implied Market Multiple
27.9x
Market is pricing in (growth)
13.4%
vs 7.7% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (35 analysts)
$235.00
Divergence from AlphaVal
47%
Summary
Using a two-stage FCF DCF with 8% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $125.70 per share.
Warnings
Wall Street's average price target is $235.00 (from 35 analysts). Our estimate is 47% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions