JPMorgan analysts have upgraded their stock rating on Cozy Services Company ( RSG ) from neutral to overweight, with a target price raised to $295. Compared to the company's closing price on Tuesday, there is a potential upside of nearly 19%.

JPMorgan analyst Tami Zakaria wrote in a research report on Wednesday: "After three consecutive years of negative growth, we expect the volume of solid waste management services to turn positive in 2027."

In the third quarter of this year, both the clearance volumes of small and large containers saw a 0.5% increase, marking the first time in over three years that both indicators have risen simultaneously. Zacharia stated that this business recovery will drive an expansion in the company's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) margin, with the increase potentially exceeding the upper limit of the company's annual target range (30-50 basis points).

According to the analyst, with the completion of the polymer processing center construction, the company's free cash flow is expected to improve by 2028. Gonghe Service also plans to fully launch an artificial intelligence-based route scheduling platform in early 2027 to enhance waste collection and transportation efficiency and reduce disposal costs.

Zacharia stated that the company is still on track to achieve its goal of generating $100 million in annualized adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) from its digital initiatives by the end of 2028.