RENTOKIL INITIAL PLC-SP ADR (RTO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:RTO - US7601251041 - ADR
30 USD
+0.11 (+0.37%)
30 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to RTO. RTO was compared to 81 industry peers in the Commercial Services & Supplies industry. While RTO is still in line with the averages on profitability rating, there are concerns on its financial health. RTO is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
RTO had positive earnings in the past year.
RTO had a positive operating cash flow in the past year.
Each year in the past 5 years RTO has been profitable.
In the past 5 years RTO always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.35%, RTO is in the better half of the industry, outperforming 60.49% of the companies in the same industry.
The Return On Equity of RTO (6.35%) is better than 60.49% of its industry peers.
RTO has a Return On Invested Capital (4.66%) which is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for RTO is below the industry average of 10.33%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.35% | ||
| ROE | 6.35% | ||
| ROIC | 4.66% |
ROA(3y)2.76%
ROA(5y)3.54%
ROE(3y)7.41%
ROE(5y)11.9%
ROIC(3y)5.49%
ROIC(5y)6.1%
1.3 Margins
The Profit Margin of RTO (4.80%) is better than 64.20% of its industry peers.
In the last couple of years the Profit Margin of RTO has declined.
The Operating Margin of RTO (10.17%) is better than 70.37% of its industry peers.
RTO's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 86.40%, RTO belongs to the best of the industry, outperforming 98.77% of the companies in the same industry.
In the last couple of years the Gross Margin of RTO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.17% | ||
| PM (TTM) | 4.8% | ||
| GM | 86.4% |
OM growth 3Y2.06%
OM growth 5Y4.21%
PM growth 3Y-14.07%
PM growth 5Y-11.59%
GM growth 3Y1.51%
GM growth 5Y1.16%
2. Health
2.1 Basic Checks
RTO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, RTO has about the same amount of shares outstanding.
The number of shares outstanding for RTO has been increased compared to 5 years ago.
The debt/assets ratio for RTO has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.21 indicates that RTO is not a great score, but indicates only limited risk for bankruptcy at the moment.
RTO has a Altman-Z score (2.21) which is comparable to the rest of the industry.
RTO has a debt to FCF ratio of 8.79. This is a slightly negative value and a sign of low solvency as RTO would need 8.79 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 8.79, RTO is doing good in the industry, outperforming 64.20% of the companies in the same industry.
A Debt/Equity ratio of 1.00 indicates that RTO is somewhat dependend on debt financing.
RTO's Debt to Equity ratio of 1.00 is on the low side compared to the rest of the industry. RTO is outperformed by 60.49% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 8.79 | ||
| Altman-Z | 2.21 |
ROIC/WACC0.61
WACC7.61%
2.3 Liquidity
RTO has a Current Ratio of 1.12. This is a normal value and indicates that RTO is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.12, RTO is doing worse than 70.37% of the companies in the same industry.
A Quick Ratio of 1.03 indicates that RTO should not have too much problems paying its short term obligations.
The Quick ratio of RTO (1.03) is worse than 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.03 |
3. Growth
3.1 Past
RTO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -15.45%.
Measured over the past years, RTO shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.17% on average per year.
RTO shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 16.75%.
RTO shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 21.48% yearly.
EPS 1Y (TTM)-15.45%
EPS 3Y3.04%
EPS 5Y8.17%
EPS Q2Q%-15.51%
Revenue 1Y (TTM)16.75%
Revenue growth 3Y34.42%
Revenue growth 5Y21.48%
Sales Q2Q%24.28%
3.2 Future
The Earnings Per Share is expected to grow by 3.43% on average over the next years.
Based on estimates for the next years, RTO will show a small growth in Revenue. The Revenue will grow by 5.94% on average per year.
EPS Next Y11.51%
EPS Next 2Y10.98%
EPS Next 3Y11.17%
EPS Next 5Y3.43%
Revenue Next Year13.41%
Revenue Next 2Y8.21%
Revenue Next 3Y6.99%
Revenue Next 5Y5.94%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 24.00, which indicates a rather expensive current valuation of RTO.
62.96% of the companies in the same industry are more expensive than RTO, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 26.92, RTO is valued at the same level.
RTO is valuated rather expensively with a Price/Forward Earnings ratio of 17.89.
Compared to the rest of the industry, the Price/Forward Earnings ratio of RTO indicates a somewhat cheap valuation: RTO is cheaper than 75.31% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of RTO to the average of the S&P500 Index (23.46), we can say RTO is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24 | ||
| Fwd PE | 17.89 |
4.2 Price Multiples
RTO's Enterprise Value to EBITDA ratio is in line with the industry average.
71.60% of the companies in the same industry are more expensive than RTO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.01 | ||
| EV/EBITDA | 14.14 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of RTO may justify a higher PE ratio.
PEG (NY)2.08
PEG (5Y)2.94
EPS Next 2Y10.98%
EPS Next 3Y11.17%
5. Dividend
5.1 Amount
RTO has a Yearly Dividend Yield of 2.04%.
Compared to an average industry Dividend Yield of 0.89, RTO pays a better dividend. On top of this RTO pays more dividend than 85.19% of the companies listed in the same industry.
RTO's Dividend Yield is comparable with the S&P500 average which is at 2.00.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.04% |
5.2 History
On average, the dividend of RTO grows each year by 20.86%, which is quite nice.
RTO has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)20.86%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
93.98% of the earnings are spent on dividend by RTO. This is not a sustainable payout ratio.
RTO's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP93.98%
EPS Next 2Y10.98%
EPS Next 3Y11.17%
30
+0.11 (+0.37%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners74.38%
Inst Owner ChangeN/A
Ins Owners0.59%
Ins Owner ChangeN/A
Market Cap15.09B
Revenue(TTM)6.97B
Net Income(TTM)334.62M
Analysts76.92
Price Target31.49 (4.97%)
Short Float %0.62%
Short Ratio3.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.04% |
Yearly Dividend0.12
Dividend Growth(5Y)20.86%
DP93.98%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)4.15%
PT rev (3m)6.76%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-0.66%
EPS NY rev (3m)35.01%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)1.52%
Revenue NY rev (3m)30.46%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24 | ||
| Fwd PE | 17.89 | ||
| P/S | 2.16 | ||
| P/FCF | 22.01 | ||
| P/OCF | 15.51 | ||
| P/B | 2.86 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.14 |
EPS(TTM)1.25
EY4.17%
EPS(NY)1.68
Fwd EY5.59%
FCF(TTM)1.36
FCFY4.54%
OCF(TTM)1.93
OCFY6.45%
SpS13.86
BVpS10.48
TBVpS-7.33
PEG (NY)2.08
PEG (5Y)2.94
Graham Number17.17
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.35% | ||
| ROE | 6.35% | ||
| ROCE | 6.46% | ||
| ROIC | 4.66% | ||
| ROICexc | 5.45% | ||
| ROICexgc | 54.53% | ||
| OM | 10.17% | ||
| PM (TTM) | 4.8% | ||
| GM | 86.4% | ||
| FCFM | 9.84% |
ROA(3y)2.76%
ROA(5y)3.54%
ROE(3y)7.41%
ROE(5y)11.9%
ROIC(3y)5.49%
ROIC(5y)6.1%
ROICexc(3y)6.28%
ROICexc(5y)8.1%
ROICexgc(3y)57.35%
ROICexgc(5y)65.65%
ROCE(3y)7.83%
ROCE(5y)9.4%
ROICexgc growth 3Y14.17%
ROICexgc growth 5Y13.56%
ROICexc growth 3Y-12.32%
ROICexc growth 5Y-7.01%
OM growth 3Y2.06%
OM growth 5Y4.21%
PM growth 3Y-14.07%
PM growth 5Y-11.59%
GM growth 3Y1.51%
GM growth 5Y1.16%
F-Score5
Asset Turnover0.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 8.79 | ||
| Debt/EBITDA | 3.95 | ||
| Cap/Depr | 46.51% | ||
| Cap/Sales | 4.12% | ||
| Interest Coverage | 2.63 | ||
| Cash Conversion | 73.35% | ||
| Profit Quality | 204.88% | ||
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.03 | ||
| Altman-Z | 2.21 |
F-Score5
WACC7.61%
ROIC/WACC0.61
Cap/Depr(3y)45.91%
Cap/Depr(5y)48.18%
Cap/Sales(3y)4.33%
Cap/Sales(5y)4.77%
Profit Quality(3y)155.2%
Profit Quality(5y)166.26%
High Growth Momentum
Growth
EPS 1Y (TTM)-15.45%
EPS 3Y3.04%
EPS 5Y8.17%
EPS Q2Q%-15.51%
EPS Next Y11.51%
EPS Next 2Y10.98%
EPS Next 3Y11.17%
EPS Next 5Y3.43%
Revenue 1Y (TTM)16.75%
Revenue growth 3Y34.42%
Revenue growth 5Y21.48%
Sales Q2Q%24.28%
Revenue Next Year13.41%
Revenue Next 2Y8.21%
Revenue Next 3Y6.99%
Revenue Next 5Y5.94%
EBIT growth 1Y1.85%
EBIT growth 3Y37.18%
EBIT growth 5Y26.6%
EBIT Next Year55.07%
EBIT Next 3Y20.61%
EBIT Next 5Y13.37%
FCF growth 1Y48.39%
FCF growth 3Y14.89%
FCF growth 5Y15.93%
OCF growth 1Y44.96%
OCF growth 3Y16.72%
OCF growth 5Y14.11%
RENTOKIL INITIAL PLC-SP ADR / RTO FAQ
Can you provide the ChartMill fundamental rating for RENTOKIL INITIAL PLC-SP ADR?
ChartMill assigns a fundamental rating of 5 / 10 to RTO.
What is the valuation status of RENTOKIL INITIAL PLC-SP ADR (RTO) stock?
ChartMill assigns a valuation rating of 5 / 10 to RENTOKIL INITIAL PLC-SP ADR (RTO). This can be considered as Fairly Valued.
Can you provide the profitability details for RENTOKIL INITIAL PLC-SP ADR?
RENTOKIL INITIAL PLC-SP ADR (RTO) has a profitability rating of 6 / 10.
Can you provide the PE and PB ratios for RTO stock?
The Price/Earnings (PE) ratio for RENTOKIL INITIAL PLC-SP ADR (RTO) is 24 and the Price/Book (PB) ratio is 2.86.
Can you provide the dividend sustainability for RTO stock?
The dividend rating of RENTOKIL INITIAL PLC-SP ADR (RTO) is 4 / 10 and the dividend payout ratio is 93.98%.