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A Morgan Stanley 'Best Idea'

Morgan Stanley gave this services stock an ‘Overweight’ rating and $38 price target citing strong catalysts. Know which one we’re talking about?

It’s Republic Services.

According to analyst Vance Edelson the call is first and foremost about fundamentals.

"The amount of trash the American public produces is vast and it also tends to grow with the population. A lot of it is entirely non-cyclical," he says.

However there are some other factors that could propel shares higher.

Edelson also says "the stock still hasn’t recovered from (the acquisition of Allied) they made recently to better compete with Waste Management." However that acquisition has generated great synergies.

"When we look at the 2011 multiples the company is only trading at 14 times earnings," he says.

And Edelson also sees more upside elsewhere.

He anticipates a tailwind from the construction sector if and when home building gets a foothold and he expects to see a buy back.

Guy Adami also likes this stock. (Read what he said about it last week. Click here to go to Profiting From Trashy Business.) In the sector Zach Karabell also suggests looking out Waste Connections .

For more on Edelson call watch the video above.


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Trader disclosure: On Oct. 4, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (GS), (INTC), (MSFT), (C), (NUE), (BTU); Adami's Wife Works At Merck ; Karabell Owns (AAPL), (FCX); Jon Najarian Is Selling (Aapl) Puts; Jon Najarian Is Long (Lvs); Jon Najarian Is Short (Lvs) Calls; Jon Najarian Is Long (Mgm); Jon Najarian Is Short (Mgm) Calls; Jon Najarian Is Short (Mos) Calls; Jon Najarian Is Short (Mos) Puts; Jon Najarian Is Long (Wynn); Jon Najarian Is Short (Wynn) Calls; Joe Terranova Is Long (EOG), (APA), (AAPL), (OIH), (VRTS), (XBI), (ARUN), (IBM), (XBI), (C), (ORCL), (PEP), (OXY), (SU), (JOYG), (RIG), (IBM), (HES), (RSH), (UPL); Stephen Weiss Owns (NIHD); Stephen Weiss Owns (SLE

For Zach Karabell:
Karabell's Firm Is Long (WCN)
Karabell's Firm Is Long (MSFT)
Karabell's Firm Is Short (SPY)
Karabell's Firm Is Short (QQQQ)

For Mike Khouw
Cantor Fitzgerald Is A Market Maker In (ADM)

For Vance Edelson
Morgan Stanley Owns 1% Or More Of (EXBD), (URS)
Morgan Stanley Has Advised On A Public Offering Of (RSG), (WM)
Morgan Stanley Has Received Compensation For Inv. Banking services from (RSG), (RHI) (URS), (WM)
Morgan Stanley Makes A Market In Shares Of (RSG), (URS), (WM)

CNBC.com with wires.

Symbol
Price
 
Change
%Change
RSG
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WCN
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