Atlanta, Georgia-based Rollins, Inc. (ROL) is a premier global consumer and commercial services company. Valued at $26.5 billion by market cap, the company provides essential pest and wildlife control services and protection against termite damage, rodents and insects to residential and commercial customers.
Companies worth $10 billion or more are generally described as “large-cap stocks,” and ROL perfectly fits that description, with its market cap exceeding this mark, underscoring its size, influence, and dominance within the personal services industry. Rollins' strength lies in its diversified portfolio and strong Orkin brand, driving strategic fit and high customer retention. In addition, its extensive network and training program create barriers to entry.
Despite its notable strength, ROL slipped 16.6% from its 52-week high of $66.14, achieved on Feb. 11. Over the past three months, ROL stock declined 8.2%, underperforming the S&P 500 Index’s ($SPX) 2.9% decline during the same time frame.
Shares of ROL fell 3.9% on a six-month basis but climbed 8.7% over the past 52 weeks, underperforming SPX’s six-month marginal gains and 20.1% returns over the last year.
To confirm the bearish trend, ROL is trading below its 200-day moving average since early March. The stock has been trading below its 50-day moving average since mid-February.
ROL's underperformance is due to early winter weather impacting one-time pest control projects.
On Feb. 11, ROL reported its Q4 results, and its shares closed down by 10.5% in the following trading session. Its adjusted EPS of $0.25 did not meet Wall Street expectations of $0.27. The company’s revenue was $912.9 million, missing Wall Street forecasts of $922.1 million.
In the competitive arena of personal services, E-Home Household Service Holdings Limited (EJH) has notably lagged behind ROL, with a 90.8% downtick on a six-month basis and 99.8% losses over the past 52 weeks.
Wall Street analysts are reasonably bullish on ROL’s prospects. The stock has a consensus “Moderate Buy” rating from the 16 analysts covering it, and the mean price target of $64.99 suggests a 17.9% potential upside from current price levels.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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