Reviewing Montrose Environmental Group (NYSE:MEG) and Republic Services (NYSE:RSG)

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

Risk and Volatility

Republic Services has a beta of 0.55, suggesting that its share price is 45% less volatile than the S&P 500. Comparatively, Montrose Environmental Group has a beta of 1.97, suggesting that its share price is 97% more volatile than the S&P 500.

Insider & Institutional Ownership

57.7% of Republic Services shares are owned by institutional investors. Comparatively, 87.9% of Montrose Environmental Group shares are owned by institutional investors. 0.1% of Republic Services shares are owned by insiders. Comparatively, 11.9% of Montrose Environmental Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Republic Services and Montrose Environmental Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Republic Services	12.77%	18.24%	6.46%
Montrose Environmental Group	-2.52%	0.17%	0.08%

Earnings and Valuation

This table compares Republic Services and Montrose Environmental Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Republic Services	$16.03 billion	4.09	$2.04 billion	$6.72	31.56
Montrose Environmental Group	$826.32 million	0.95	-$62.31 million	($0.91)	-24.31

Republic Services has higher revenue and earnings than Montrose Environmental Group. Montrose Environmental Group is trading at a lower price-to-earnings ratio than Republic Services, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Republic Services and Montrose Environmental Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Republic Services	0	10	14	1	2.64
Montrose Environmental Group	1	2	3	0	2.33

Republic Services currently has a consensus target price of $248.82, suggesting a potential upside of 17.33%. Montrose Environmental Group has a consensus target price of $33.50, suggesting a potential upside of 51.41%. Given Montrose Environmental Group’s higher possible upside, analysts clearly believe Montrose Environmental Group is more favorable than Republic Services.

Summary

Republic Services beats Montrose Environmental Group on 11 of the 15 factors compared between the two stocks.

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.

About Montrose Environmental Group

Montrose Environmental Group, Inc. operates as an environmental services company in the United States, Canada, and internationally. The company operates in three segments: Assessment, Permitting and Response; Measurement and Analysis; and Remediation and Reuse. The Assessment, Permitting and Response segment provides scientific advisory and consulting services to support environmental assessments; environmental emergency response and recovery; toxicology consulting and environmental audits and permits for current operations; facility upgrades; new projects; decommissioning projects; and development projects. This segment also offers technical advisory and consulting services, including regulatory compliance support and planning, environmental, ecosystem and toxicological assessments, and support during responses to environmental disruptions. The Measurement and Analysis segment tests and analyzes air, water, and soil to determine concentrations of contaminants, as well as the toxicological impact of contaminants on flora, fauna, and human health. Its services include source and ambient air testing and monitoring, leak detection, and advanced analytical laboratory services, such as storm water, wastewater, and drinking water analysis. The Remediation and Reuse segment provides engineering, design, implementation, and operations and maintenance services primarily to treat contaminated water, remove contaminants from soil, or create biogas from waste. The company serves financial, oil and gas, utilities, construction, automotive, real-estate, midstream energy, manufacturing, commodities, petrochemical, food and beverage, telecommunications, and engineering industries, as well as local, state, provincial, and federal government entities. Montrose Environmental Group, Inc. was founded in 2012 and is headquartered in North Little Rock, Arkansas.