Financial Contrast: Zurn Elkay Water Solutions Cor (NYSE:ZWS) & Republic Services (NYSE:RSG)

Zurn Elkay Water Solutions Cor (NYSE:ZWS) and Republic Services (NYSE:RSG) are both business services companies, but which is the better investment? We will compare the two companies based on the strength of their risk, earnings, institutional ownership, dividends, analyst recommendations, valuation and profitability.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Zurn Elkay Water Solutions Cor and Republic Services, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zurn Elkay Water Solutions Cor	0	3	3	1	2.71
Republic Services	0	11	14	2	2.67

Zurn Elkay Water Solutions Cor currently has a consensus price target of $42.83, indicating a potential downside of 8.08%. Republic Services has a consensus price target of $250.91, indicating a potential upside of 14.46%. Given Republic Services’ higher probable upside, analysts plainly believe Republic Services is more favorable than Zurn Elkay Water Solutions Cor.

Profitability

This table compares Zurn Elkay Water Solutions Cor and Republic Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zurn Elkay Water Solutions Cor	11.59%	16.26%	9.66%
Republic Services	12.97%	18.27%	6.48%

Risk and Volatility

Zurn Elkay Water Solutions Cor has a beta of 1.12, suggesting that its stock price is 12% more volatile than the S&P 500. Comparatively, Republic Services has a beta of 0.57, suggesting that its stock price is 43% less volatile than the S&P 500.

Earnings & Valuation

This table compares Zurn Elkay Water Solutions Cor and Republic Services”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zurn Elkay Water Solutions Cor	$1.66 billion	4.70	$160.20 million	$1.12	41.61
Republic Services	$16.50 billion	4.11	$2.04 billion	$6.72	32.62

Republic Services has higher revenue and earnings than Zurn Elkay Water Solutions Cor. Republic Services is trading at a lower price-to-earnings ratio than Zurn Elkay Water Solutions Cor, indicating that it is currently the more affordable of the two stocks.

Dividends

Zurn Elkay Water Solutions Cor pays an annual dividend of $0.44 per share and has a dividend yield of 0.9%. Republic Services pays an annual dividend of $2.50 per share and has a dividend yield of 1.1%. Zurn Elkay Water Solutions Cor pays out 39.3% of its earnings in the form of a dividend. Republic Services pays out 37.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Zurn Elkay Water Solutions Cor has raised its dividend for 3 consecutive years and Republic Services has raised its dividend for 22 consecutive years. Republic Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

83.3% of Zurn Elkay Water Solutions Cor shares are held by institutional investors. Comparatively, 57.7% of Republic Services shares are held by institutional investors. 2.6% of Zurn Elkay Water Solutions Cor shares are held by company insiders. Comparatively, 0.1% of Republic Services shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Republic Services beats Zurn Elkay Water Solutions Cor on 11 of the 18 factors compared between the two stocks.

About Zurn Elkay Water Solutions Cor

Zurn Elkay Water Solutions Corporation engages in design, procurement, manufacture, and marketing of water management solutions in the United States, Canada, and internationally. It offers water safety and control products, such as backflow preventers, fire system valves, pressure reducing valves, thermostatic mixing valves, PEX pipings, fittings, and installation tools under the Zurn and Wilkins brand names. The company also provides flow systems products comprising point drains, hydrants, fixture carrier systems, chemical drainage systems; and interceptors and separators, acid neutralization systems, and remote monitoring systems under the Zurn and Green Turtle brands. In addition, it develops, manufactures, and markets remote tank monitoring devices, alarms, software, and services. Further, the company offers sensor-operated flush valves under the AquaSense, Aquaflush, and AquaVantage brands; heavy-duty commercial faucets under the AquaSpec brand; water conserving fixtures under the EcoVantage and Zurn One brands; stainless steel products under the Just Manufacturing brand name, which include stainless steel sinks and plumbing fixtures, and various types of sinks, as well as drinking water dispensing and filtration products under the Elkay and Halsey Taylor brands. It distributes to institutional, commercial, waterworks, and residential end markets through independent sales representatives, plumbing wholesalers, and industry-specific distributors in the waterworks, foodservice, industrial, janitorial, sanitation, and sitework industries. The company was formerly known as Zurn Water Solutions Corporation and changed its name to Zurn Elkay Water Solutions Corporation in July 2022. Zurn Elkay Water Solutions Corporation was incorporated in 1892 and is headquartered in Milwaukee, Wisconsin.

About Republic Services

Republic Services, Inc., together with its subsidiaries, offers environmental services in the United States and Canada. It is involved in the collection and processing of recyclable, solid waste, and industrial waste materials; transportation and disposal of non-hazardous and hazardous waste streams; and other environmental solutions. Its residential collection services include curbside collection of material for transport to transfer stations, landfills, recycling centers, and organics processing facilities; supply of recycling and waste containers; and renting of compactors. The company also engages in the processing and sale of old corrugated containers, old newsprint, aluminum, glass, and other materials; and provision of landfill services. It serves small-container, large-container, and residential customers. The company was incorporated in 1996 and is based in Phoenix, Arizona.