Chicago, IL – November 25, 2025 – Today, Zacks Equity Research discusses Xylem XYL, Zurn Elkay Water Solutions Corp. ZWS and Republic Services RSG.
Industry: Waste Management
Link: https://www.zacks.com/commentary/2794687/3-stocks-to-consider-from-the-growing-waste-removal-services-market
The Waste Management industry is experiencing positive trends in government regulations, advanced technologies and a rising awareness of environmental issues. The industry is pro-swift industrialization and urbanization. Per MarketsandMarkets, the global waste management sector reached $1.2 trillion in 2024 and is expected to undergo substantial growth, reaching $1.6 trillion by 2029. The potential expansion of the global waste management sector can be attributed to improved waste collection methods and rising volumes of waste in emerging markets.
Three stocks from the Waste Removal Services market poised for growth are Xylem, Zurn Elkay Water Solutions Corp. and Republic Services.
About the Industry
Companies in the Zacks Waste Removal Services industry play a vital role in the collection, treatment and responsible management of diverse waste types, aiming to minimize their impacts on the environment and public health. This market is categorized into distinct segments based on the kind of waste, including industrial, commercial, domestic and agricultural.
The Industrial waste segment has gained significance due to the ongoing industrial expansion, creating a substantial demand for efficient waste management solutions. The market encompasses Collection and Disposal services. The Disposal services segment, primarily fueled by the growing need for waste recycling to mitigate environmental impacts, stands as the primary revenue-generating category.
What’s Shaping the Future of the Business Services Industry?
Environmental, Social and Governance (“ESG”) Goals: Waste management is a cornerstone of ESG principles, as it helps companies support their ESG ratings by promoting environmental sustainability, fostering social well-being and upholding good governance. Responsible waste management meets legal requirements and aids consumers and investors’ desire for sustainable and ethical business practices. Currently, waste management is not only a duty but also a means to display ESG values, underscoring business success.
Tech-Driven Waste Management Industry Growth: Technology has become a core component in waste management, mitigating the challenges of waste generation and environmental impacts. This transformative correlation promises a more sustainable future. For instance, AI is emerging as a crucial tool to sort waste and keep recyclable materials from going into landfills.
Advancing technology results in efficient, eco-friendly waste management, reducing the ecological footprint and promoting sustainability. Waste challenges can be mitigated using technology that leads us toward responsible waste management and a cleaner planet.
Waste-to-Energy (“WTE”)Innovation: WTE comprises thermal (pyrolysis, incineration and gasification) and biological solutions (composting and anaerobic digestion), a cornerstone in sustainable waste management. This technology transforms waste into energy via methods like incineration or gasification. Per a report by Precedence Research, the Waste-to-Energy Market size is anticipated to be $48.1 billion in 2024 and reach $93 billion by 2034, witnessing a CAGR of 6.8%.
The increment is anticipated to be driven by an increasing amount of waste generation, growing waste management concerns to meet sustainable living standards, and increased focus on non-fossil fuels. The industry holds a vital position in the era of clean energy, offering a renewable energy source and addressing the hindrances around waste management.
Zacks Industry Rank Indicates Bright Near-Term Prospects
The Zacks Waste Removal Services industry, which is housed within the Zacks Business Services sector, currently carries a Zacks Industry Rank #90. This rank places it in the top 37% of 243 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates a continued outperformance in the near term. Our research shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
Before we present a few stocks that you may want to consider for your portfolio, let us take a look at the industry’s recent stock market performance and current valuation.
Industry’s Comparison with Sector & S&P 500
The Zacks Waste Removal Services industry has mitigated the decline better than the broader sector while severely underperforming the S&P 500 over the past year.
The industry has dipped 7.3% compared with 13.3% growth of the broader sector and the Zacks S&P 500 composite’s 13.7% rally.
Industry’s Current Valuation
Based on EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation and amortization), which is commonly used for valuing Waste Removal services stocks because of their high debt levels, the industry is currently trading at 12.67X compared with the S&P 500’s 17.94X and the sector’s 10.23X.
Over the past five years, the industry has traded as high as 14.34X and as low as 12.26X, the median being 13.9X.
3 Waste Removal Services Stocks to Bet On
Xylem: This company specializes in designing, manufacturing, and servicing engineered products and solutions for utility, industrial, residential, and commercial buildings globally.
During the third quarter of 2025, XYL’s top line climbed 7% year over year, banking on robust double-digit growth in measurement and control solutions (MCS), water solutions and services segments. The company holds a significant backlog of nearly $5 billion, with $1.5 billion from the MCS segment, painting a clear picture of 2026 despite the China setback.
XYL’s strong operational efficiency is validated by its EBITDA margin exceeding 23%, an expansion of 200 basis points (bps) year over year, fueled by productivity, pricing, and volume. Management anticipates this margin to hover around 22-23% for the full year, raising a green flag for investors expecting consistent margins.
The company partnered with Amazon is deploying Xylem Vue advanced analytics in Mexico City on Monterrey, supporting these cities to save more than 1 billion liters of water per year. A solution that creates a meaningful impact on both customers and communities raises Xylem’s brand value.
XYL carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for the company’s 2025 earnings gained 4.4% in the past 60 days. Xylemshares have soared 22.1% in the year-to-date period.
Zurn Elkay Water Solutions Corp.: This company specializes in designing, procuring, manufacturing, and marketing water management solutions.
During the third quarter of 2025, ZWS’s sales improved 11% year over year on the back of solid execution on growth initiatives. Despite softness in the residential market, the top line was elevated by end markets and the non-residential market. Margin expansion of 120 bps year over year, driven by volume leverage, productivity initiatives, Zurn Elkay Business System’s utilization, and consistent enhancement in activities across the company, signals operational efficiency.
On the product front, ZWS is introducing Elkay Liv built-in filtered bottle fillers. This product complements any home design and delivers filtered water to every room. The company witnessed increased acceptance of Pro Filtration, incorporating filtered water bottle filling technologies with improved maintenance and higher filter capacity.
ZWS has a Zacks Rank #2 at present. The Zacks Consensus Estimate for its 2025 bottom line has increased 4.2% in the past 60 days. ZWS shares have risen 26.2% in the year-to-date period.
Republic Services: This company provides collection, recycling, disposal, and environmental services in the United States and Canada.
During the third quarter of 2025, RSG’s top line gained 3.3% year over year, backed by strong pricing. With improved revenues, the company witnessed margin improvement with adjusted EBITDA of 32.8%, up 80 bps year over year. Operational efficacy as such was driven by prudent cost management.
The company is progressing on the development of Polymer Centers and Blue Polymers joint venture facilities. During July, RSG began commercial production at the Indianapolis Polymer Center. We expect this development to improve recycling circularity. RSG made advancements in renewable natural gas projects with its partners, commencing six projects by the third quarter of 2025, and expects to add another in 2025.
Republic Services’ commitment to fleet electrification is impressive. The company had 137 collection vehicles in operation at the end of the third quarter of 2025 and expects more than 150 electric vehicles (EVs) in its fleet. Currently, RSG operates 32 facilities with commercial-scale EV charging infrastructure. Initiatives such as these support the growth of RSG’s differentiated service offering.
RSG carries a Zacks Rank #3 (Hold) at present. The Zacks Consensus Estimate for its 2025 bottom line moved up marginally over the past 60 days. RSG shares have risen 10% in the year-to-date period.
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Republic Services, Inc. (RSG) : Free Stock Analysis Report
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