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Three analysts and top management from fourteen sector firms examine the Environmental Services sector in this 64-page Environmental Services Issue from The Wall Street Transcript, available at (212/952-7433) or www.twst.com

TWST: Amanda, what have you seen? From a market perspective, are the stocks reflecting any change?

Ms. Tepper: Clearly the stocks started to rally over the last couple of months in anticipation of an improvement in the underlying environment. We thought that they got a bit ahead of themselves and there seems to be something of a correction now after second quarter earnings have been released. The outlook for the rest of the year seems to be a bit more muted than we think investors were hoping for. But the cash flows have held up, which is characteristic of the group.

TWST: What’s the disconnect between what investors were expecting and what seems to be taking place?

Ms. Tepper: I think there are two big disconnects. One is that there was a sense out there that pricing was finally taking off. There was going to be real oligopoly pricing power happening in real time and you would actually see upside to everyone’s earnings estimates over the next six to 12 months. In fact, pricing seems as competitive as ever; it’s very difficult out there. So I think that’s one. The other is the disconnect between the macro data, which on any given day over the last couple of months seems to indicate that overall the economy is climbing out of the funk that it has been in, and the fact that in this group any earnings impact is going to lag any pickup in the economy in general by a good six to nine months. Also, there is the macro economy overall and there is what’s happening in the parts that impact industrial volumes, which is really what moves earnings for these companies. So it’s really manufacturing and construction. I’m not a macro economist, but if you look at the data a lot of what has been getting stronger is services, which doesn’t help this industry.

TWST: Amanda, you said that you have a defensive posture but like Republic. What is it about Republic that you like?

Ms. Tepper: The earnings visibility is tied to their business mix which is the most defensive of the group. They have the least exposure to industrial waste volumes of pretty much everyone in the group, perhaps with the exception of Waste Connections. Therefore, to the extent that industrial volumes don’t pick up as quickly as the market might have priced in, their earnings should hold up the best of everybody. They also have the most long-standing share purchase program. Their dividend is incremental to the share repurchase. You can count on that repurchasing in a consistent manner, which also gives visibility to the EPS.

TWST: In terms of the stock repurchase program, is it price-sensitive or not?

Ms. Tepper: In my humble opinion, they have done a pretty good job of executing it opportunistically but, historically, they have spent all their money every year. Intra-quarter or intra-year, they are fairly opportunistic, but they don’t just hold off and not execute it. You can count on them over the course of the year to spend on the repurchase everything they say they will.

This special issue includes:

1) Environmental Services - In an in-depth (7,800 words) Roundtable Forum, Bradley Coltman, a senior analyst at Deutsche Bank Securities, Michael E. Hoffman, a Managing Director of Friedman, Billings, Ramsey Group and Amanda Tepper, a Senior Analyst at JP Morgan Securities, examine the outlook for the sector and share specific stock recommendations.

2) CEO interviews (average 2,500 words). Top management of fourteen - sector firms examine the outlook for their firm and the sector. Firms include:.

ZENON Environmental Inc., ATC Associates, CLARCOR Inc., Commodore Applied Technologies, Duratek, Environmental Safeguards, GreenMan Technologies, Life Energy & Technology Holdings, Met-Pro Corporation, PDG Environmental, Synagro Technologies, U.S. Microbics, Versar, Waste Connections.