ROLLINS INC (ROL) Stock Fundamental Analysis
NYSE:ROL - New York Stock Exchange, Inc. - US7757111049 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to ROL. ROL was compared to 83 industry peers in the Commercial Services & Supplies industry. ROL has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. ROL is quite expensive at the moment. It does show a decent growth rate. With these ratings, ROL could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
In the past year ROL was profitable.
ROL had a positive operating cash flow in the past year.
ROL had positive earnings in each of the past 5 years.
In the past 5 years ROL always reported a positive cash flow from operatings.
1.2 Ratios
ROL's Return On Assets of 16.19% is amongst the best of the industry. ROL outperforms 93.98% of its industry peers.
With an excellent Return On Equity value of 35.20%, ROL belongs to the best of the industry, outperforming 92.77% of the companies in the same industry.
ROL has a better Return On Invested Capital (21.39%) than 93.98% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ROL is significantly above the industry average of 11.67%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.19% | ||
| ROE | 35.2% | ||
| ROIC | 21.39% |
ROA(3y)16.89%
ROA(5y)16.49%
ROE(3y)33.93%
ROE(5y)32.31%
ROIC(3y)22.15%
ROIC(5y)21.52%
1.3 Margins
ROL's Profit Margin of 13.78% is amongst the best of the industry. ROL outperforms 86.75% of its industry peers.
In the last couple of years the Profit Margin of ROL has grown nicely.
ROL has a better Operating Margin (19.27%) than 89.16% of its industry peers.
In the last couple of years the Operating Margin of ROL has grown nicely.
ROL has a better Gross Margin (52.70%) than 90.36% of its industry peers.
In the last couple of years the Gross Margin of ROL has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.27% | ||
| PM (TTM) | 13.78% | ||
| GM | 52.7% |
OM growth 3Y1.65%
OM growth 5Y4.25%
PM growth 3Y-2.19%
PM growth 5Y6.41%
GM growth 3Y0.41%
GM growth 5Y0.77%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ROL is creating value.
ROL has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for ROL has been reduced compared to 5 years ago.
The debt/assets ratio for ROL has been reduced compared to a year ago.
2.2 Solvency
ROL has an Altman-Z score of 12.55. This indicates that ROL is financially healthy and has little risk of bankruptcy at the moment.
ROL has a Altman-Z score of 12.55. This is amongst the best in the industry. ROL outperforms 93.98% of its industry peers.
ROL has a debt to FCF ratio of 0.81. This is a very positive value and a sign of high solvency as it would only need 0.81 years to pay back of all of its debts.
ROL has a better Debt to FCF ratio (0.81) than 85.54% of its industry peers.
ROL has a Debt/Equity ratio of 0.36. This is a healthy value indicating a solid balance between debt and equity.
ROL has a better Debt to Equity ratio (0.36) than 61.45% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 0.81 | ||
| Altman-Z | 12.55 |
ROIC/WACC2.12
WACC10.1%
2.3 Liquidity
A Current Ratio of 0.87 indicates that ROL may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.87, ROL is doing worse than 80.72% of the companies in the same industry.
A Quick Ratio of 0.81 indicates that ROL may have some problems paying its short term obligations.
The Quick ratio of ROL (0.81) is worse than 78.31% of its industry peers.
ROL does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.81 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 9.78% over the past year.
ROL shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.58% yearly.
The Revenue has grown by 9.46% in the past year. This is quite good.
The Revenue has been growing by 10.95% on average over the past years. This is quite good.
EPS 1Y (TTM)9.78%
EPS 3Y13.9%
EPS 5Y15.58%
EPS Q2Q%10%
Revenue 1Y (TTM)9.46%
Revenue growth 3Y11.81%
Revenue growth 5Y10.95%
Sales Q2Q%9.91%
3.2 Future
Based on estimates for the next years, ROL will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.30% on average per year.
ROL is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.70% yearly.
EPS Next Y13.46%
EPS Next 2Y12.83%
EPS Next 3Y12.44%
EPS Next 5Y10.3%
Revenue Next Year11.11%
Revenue Next 2Y9.84%
Revenue Next 3Y9.31%
Revenue Next 5Y8.7%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 55.86, which means the current valuation is very expensive for ROL.
ROL's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of ROL to the average of the S&P500 Index (27.15), we can say ROL is valued expensively.
Based on the Price/Forward Earnings ratio of 44.76, the valuation of ROL can be described as expensive.
ROL's Price/Forward Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.60, ROL is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 55.86 | ||
| Fwd PE | 44.76 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ROL is valued a bit more expensive than 66.27% of the companies in the same industry.
ROL's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 45.58 | ||
| EV/EBITDA | 35.3 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ROL does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of ROL may justify a higher PE ratio.
A more expensive valuation may be justified as ROL's earnings are expected to grow with 12.44% in the coming years.
PEG (NY)4.15
PEG (5Y)3.59
EPS Next 2Y12.83%
EPS Next 3Y12.44%
5. Dividend
5.1 Amount
ROL has a Yearly Dividend Yield of 1.19%.
ROL's Dividend Yield is a higher than the industry average which is at 2.45.
With a Dividend Yield of 1.19, ROL pays less dividend than the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.19% |
5.2 History
The dividend of ROL is nicely growing with an annual growth rate of 14.46%!
ROL has been paying a dividend for at least 10 years, so it has a reliable track record.
ROL has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)14.46%
Div Incr Years22
Div Non Decr Years25
5.3 Sustainability
ROL pays out 63.98% of its income as dividend. This is not a sustainable payout ratio.
ROL's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP63.98%
EPS Next 2Y12.83%
EPS Next 3Y12.44%
56.42
+0.25 (+0.45%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners53.71%
Inst Owner Change0.72%
Ins Owners4.73%
Ins Owner Change-0.02%
Market Cap27.34B
Analysts71.25
Price Target56.83 (0.73%)
Short Float %2.67%
Short Ratio3.83
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.19% |
Yearly Dividend0.62
Dividend Growth(5Y)14.46%
DP63.98%
Div Incr Years22
Div Non Decr Years25
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.79%
Min EPS beat(2)-1.8%
Max EPS beat(2)0.23%
EPS beat(4)2
Avg EPS beat(4)-1.48%
Min EPS beat(4)-4.7%
Max EPS beat(4)0.36%
EPS beat(8)3
Avg EPS beat(8)0.06%
EPS beat(12)6
Avg EPS beat(12)0.73%
EPS beat(16)8
Avg EPS beat(16)0.82%
Revenue beat(2)1
Avg Revenue beat(2)0.24%
Min Revenue beat(2)-0.28%
Max Revenue beat(2)0.77%
Revenue beat(4)1
Avg Revenue beat(4)-0.32%
Min Revenue beat(4)-1.33%
Max Revenue beat(4)0.77%
Revenue beat(8)4
Avg Revenue beat(8)0%
Revenue beat(12)7
Avg Revenue beat(12)0.44%
Revenue beat(16)10
Avg Revenue beat(16)0.69%
PT rev (1m)2.73%
PT rev (3m)8.59%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)0.28%
EPS NY rev (1m)0.02%
EPS NY rev (3m)0.33%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)1.36%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)1.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 55.86 | ||
| Fwd PE | 44.76 | ||
| P/S | 7.9 | ||
| P/FCF | 45.58 | ||
| P/OCF | 43.6 | ||
| P/B | 20.17 | ||
| P/tB | N/A | ||
| EV/EBITDA | 35.3 |
EPS(TTM)1.01
EY1.79%
EPS(NY)1.26
Fwd EY2.23%
FCF(TTM)1.24
FCFY2.19%
OCF(TTM)1.29
OCFY2.29%
SpS7.15
BVpS2.8
TBVpS-0.74
PEG (NY)4.15
PEG (5Y)3.59
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.19% | ||
| ROE | 35.2% | ||
| ROCE | 28.87% | ||
| ROIC | 21.39% | ||
| ROICexc | 23.43% | ||
| ROICexgc | 124.56% | ||
| OM | 19.27% | ||
| PM (TTM) | 13.78% | ||
| GM | 52.7% | ||
| FCFM | 17.32% |
ROA(3y)16.89%
ROA(5y)16.49%
ROE(3y)33.93%
ROE(5y)32.31%
ROIC(3y)22.15%
ROIC(5y)21.52%
ROICexc(3y)23.33%
ROICexc(5y)22.85%
ROICexgc(3y)136.66%
ROICexgc(5y)139.1%
ROCE(3y)29.89%
ROCE(5y)29.05%
ROICexcg growth 3Y-6.03%
ROICexcg growth 5Y8.73%
ROICexc growth 3Y0.12%
ROICexc growth 5Y4.25%
OM growth 3Y1.65%
OM growth 5Y4.25%
PM growth 3Y-2.19%
PM growth 5Y6.41%
GM growth 3Y0.41%
GM growth 5Y0.77%
F-Score7
Asset Turnover1.17
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 0.81 | ||
| Debt/EBITDA | 0.62 | ||
| Cap/Depr | 23.61% | ||
| Cap/Sales | 0.78% | ||
| Interest Coverage | 23.87 | ||
| Cash Conversion | 80.14% | ||
| Profit Quality | 125.71% | ||
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.81 | ||
| Altman-Z | 12.55 |
F-Score7
WACC10.1%
ROIC/WACC2.12
Cap/Depr(3y)30.15%
Cap/Depr(5y)29.05%
Cap/Sales(3y)1%
Cap/Sales(5y)1.04%
Profit Quality(3y)118.83%
Profit Quality(5y)123.95%
High Growth Momentum
Growth
EPS 1Y (TTM)9.78%
EPS 3Y13.9%
EPS 5Y15.58%
EPS Q2Q%10%
EPS Next Y13.46%
EPS Next 2Y12.83%
EPS Next 3Y12.44%
EPS Next 5Y10.3%
Revenue 1Y (TTM)9.46%
Revenue growth 3Y11.81%
Revenue growth 5Y10.95%
Sales Q2Q%9.91%
Revenue Next Year11.11%
Revenue Next 2Y9.84%
Revenue Next 3Y9.31%
Revenue Next 5Y8.7%
EBIT growth 1Y9.67%
EBIT growth 3Y13.66%
EBIT growth 5Y15.67%
EBIT Next Year27.72%
EBIT Next 3Y16.13%
EBIT Next 5Y12.82%
FCF growth 1Y33.64%
FCF growth 3Y15.69%
FCF growth 5Y15.51%
OCF growth 1Y30.87%
OCF growth 3Y14.78%
OCF growth 5Y14.47%