Story updated at 9:55 a.m. to reflect market activity.
Shares of Republic Services fell -0.4%% to $39.19 in morning trading.
The downgrade is due to a valuation call, according to the analyst firm. Republic Services exceeded KeyBanc's $39 price target, and its risk/reward balance has become more balanced according to analysts Joe Box and Sean Egan. "We prefer to wait for a better entry point at this time," the analysts wrote.
The analysts continued, "We acknowledge several catalysts exist that could support the shares, which include: 1) the potential for additional stock accumulation from its largest holder, Cascade; 2) a normalization of CPI, which could help pricing down the road; 3) ongoing improvement in construction volumes; and 4) robust cash flow optionality."
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Separately, TheStreet Ratings team rates REPUBLIC SERVICES INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate REPUBLIC SERVICES INC (RSG) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in stock price during the past year, impressive record of earnings per share growth, compelling growth in net income and reasonable valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow."