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Rollins
(NYSE:ROL)
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Rating:66Neutral
Price Target:
$49.00
▼(-10.91% Downside)
Action:Downgraded
Date:05/27/26
The score is supported by high-quality underlying financial performance (durable margins, strong returns, solid cash generation) and a generally positive outlook and guidance from the latest earnings call. It is held back by clear technical weakness (below key moving averages with negative MACD) and a demanding valuation (high P/E with modest yield), which reduce near-term risk/reward despite solid fundamentals.
Positive Factors
High and Durable Margins & Returns
Rollins generates persistently strong service margins and very high returns on equity, indicating a capital-efficient, defensible business model. Durable gross margins from recurring services and high ROE support sustained cash profits and reinvestment capacity over cycles.
Negative Factors
Rising Leverage and Debt Load
Higher leverage reduces financial flexibility for opportunistic M&A, weathering demand shocks, or extended cash shortfalls. While current ratios remain manageable, sustained debt growth can strain credit capacity and increase sensitivity to interest cost or covenant pressure.
Read all positive and negative factors
Positive Factors
Negative Factors
High and Durable Margins & Returns
Rollins generates persistently strong service margins and very high returns on equity, indicating a capital-efficient, defensible business model. Durable gross margins from recurring services and high ROE support sustained cash profits and reinvestment capacity over cycles.
Read all positive factors
Rollins Key Performance Indicators (KPIs)
Any
Revenue by Geography
Shows how much revenue comes from different regions, highlighting where Rollins is strongest and where growth or risk is concentrated. Geographic splits reveal exposure to U.S. seasonality and local weather patterns, the impact of regional competition or regulation, and how much international markets or currency swings could affect top-line stability and expansion opportunities.
Shows how much revenue comes from different regions, highlighting where Rollins is strongest and where growth or risk is concentrated. Geographic splits reveal exposure to U.S. seasonality and local weather patterns, the impact of regional competition or regulation, and how much international markets or currency swings could affect top-line stability and expansion opportunities.
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The Fly
The FlyRollins (ROL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.64B
Dividend Yield1.12%
Average Volume (3M)4.82M
Price to Earnings (P/E)41.2
Beta (1Y)0.41
Revenue Growth11.03%
EPS Growth11.08%
CountryUS
Employees20,000
SectorConsumer Cyclical
Sector Strength84
IndustryPersonal Products & Services
Share Statistics
EPS (TTM)1.09
Shares Outstanding481,463,650
10 Day Avg. Volume4,474,047
30 Day Avg. Volume4,824,587
Financial Highlights & Ratios
PEG Ratio4.07
Price to Book (P/B)21.14
Price to Sales (P/S)7.73
P/FCF Ratio44.70
Enterprise Value/Market Cap1.05
Enterprise Value/Revenue5.90
Enterprise Value/Gross Profit11.39
Enterprise Value/Ebitda26.34
Forecast
1Y Price Target
$61.83Price Target Upside12.42% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
EPS Forecast (FY)1.23
Revenue Forecast (FY)$4.13B
Rollins Business Overview & Revenue Model
Company Description
Rollins, Inc. operates a network of subsidiaries that specialize in delivering pest and wildlife management solutions to a diverse clientele, encompassing both homeowners and commercial enterprises, throughout the United States and globally. For r...
How the Company Makes Money
Rollins makes money primarily by providing recurring and one-time pest control services to residential and commercial customers. Its core revenue stream is service revenue generated from scheduled pest management programs (often delivered under re...
Rollins Earnings Call Summary
Earnings Call Date:Apr 22, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 22, 2026
Earnings Call Sentiment Positive
The call presented a predominantly positive operational and financial picture: strong revenue and organic growth across segments, improving March exit trends, healthy cash generation, a low leverage ratio, and a confident 2026 outlook with pricing support. Offsetting items were largely seasonal or explainable short-term headwinds — notably margin pressure from insurance/claims, lower vehicle gains, and the deliberate decision to carry incremental staffing into peak season — which management expects to moderate as volumes ramp. Management reiterated targets for organic growth, M&A contribution, margin improvement, and cash conversion, and will provide further detail at an upcoming Investor Day.Positive Updates
Strong Top-Line Growth
Total revenue grew 10.2% year-over-year with organic growth of 6.6%. The company exited March with approximately 12% total growth and over 8% organic growth, and organic growth improved ~90 basis points versus Q4 2025.
Negative Updates
Gross Margin Pressure in Q1
Gross margin was 50.8%, down 60 basis points year-over-year. Key headwinds cited included lower vehicle gains (~50 bps), higher insurance and claims (~30 bps) and service payroll carrying more technicians (~20 bps).
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Top-Line Growth
Total revenue grew 10.2% year-over-year with organic growth of 6.6%. The company exited March with approximately 12% total growth and over 8% organic growth, and organic growth improved ~90 basis points versus Q4 2025.
Read all positive updates
Company Guidance
Management reiterated 2026 guidance for organic growth of 7–8% with M&A adding 2–3% (implying roughly 9–11% total), expects pricing to contribute 3–4% (ahead of CPI) and to be positive on price/cost, sees fuel tracking below 2% of sales (Q1 ~1.5%), and expects an effective tax rate under 25% for the year (Q1 21.3%); they expect free cash flow conversion above 100% in 2026 (Q1 OCF $118M, FCF $111M; excluding timing items FCF would have risen 14% and conversion ~140%), improving gross margins from Q1’s 50.8% (down 60 bps) and adjusted EBITDA of $179M (19.8% margin) as peak-season volumes ramp and headwinds from lower vehicle gains (~50 bps), insurance/claims (~30 bps; Q1 insurance 3.7% of sales) and extra service payroll (~20 bps) abate; balance sheet metrics include Q1 acquisitions of $18M, dividends paid $88M and leverage of 0.9x.Rollins Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
72
Positive
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.84B | 3.76B | 3.39B | 3.07B | 2.70B | 2.42B |
| Gross Profit | 1.99B | 1.86B | 1.79B | 1.60B | 1.39B | 1.26B |
| EBITDA | 860.93M | 854.23M | 771.13M | 688.17M | 592.88M | 569.87M |
| Net Income | 529.29M | 526.71M | 466.38M | 434.96M | 368.60M | 356.56M |
Balance Sheet | ||||||
| Total Assets | 3.16B | 3.14B | 2.82B | 2.60B | 2.12B | 2.02B |
| Cash, Cash Equivalents and Short-Term Investments | 116.54M | 100.00M | 90.63M | 104.83M | 95.85M | 117.90M |
| Total Debt | 1.07B | 1.04B | 812.53M | 816.35M | 533.22M | 402.76M |
| Total Liabilities | 1.78B | 1.77B | 1.49B | 1.44B | 854.83M | 910.32M |
| Stockholders Equity | 1.38B | 1.37B | 1.33B | 1.16B | 1.27B | 1.11B |
Cash Flow | ||||||
| Free Cash Flow | 621.14M | 650.02M | 580.08M | 495.90M | 435.30M | 374.61M |
| Operating Cash Flow | 649.58M | 678.11M | 607.65M | 528.37M | 465.93M | 401.81M |
| Investing Cash Flow | -318.70M | -326.70M | -176.23M | -372.89M | -134.14M | -98.97M |
| Financing Cash Flow | -415.16M | -343.58M | -440.71M | -149.42M | -336.02M | -290.16M |
Rollins Technical Analysis
Neutral
55.00
Price Trends
49.03
Negative
52.52
Negative
55.86
Negative
Market Momentum
-1.60
Negative
46.79
Neutral
62.02
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ROL, the sentiment is Neutral. The current price of 55 is above the 20-day moving average (MA) of 44.69, above the 50-day MA of 49.03, and below the 200-day MA of 55.86, indicating a neutral trend. The MACD of -1.60 indicates Negative momentum. The RSI at 46.79 is Neutral, neither overbought nor oversold. The STOCH value of 62.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ROL.
Rollins Risk Analysis
Rollins disclosed 1 risk factors in its most recent earnings report. Rollins reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Rollins Peers Comparison
UnderperformOutperform
Sector (61)
ROL
Rollins
44.95
-9.99
-18.18%
FTDR
frontdoor
73.13
14.75
25.27%
Rollins Corporate Events
Business Operations and StrategyExecutive/Board Changes
Rollins Announces CFO Transition and Leadership Succession Plan
Positive
May 27, 2026
On May 26 and May 27, 2026, Rollins announced a planned change in financial leadership, with longtime finance executive William W. Harkins elevated from chief accounting officer to executive vice president and chief financial officer, effective Ju...
Executive/Board ChangesShareholder Meetings
Rollins Shareholders Approve Directors, Auditor and Executive Pay
Positive
May 1, 2026
On April 28, 2026, Rollins, Inc. held its 2026 annual meeting of shareholders, where investors elected nine director nominees to serve until the 2027 annual meeting, reinforcing continuity in the company’s board leadership. The voting result...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.