RENTOKIL INITIAL PLC-SP ADR (RTO) Stock Fundamental Analysis
USA - NYSE:RTO - US7601251041 - ADR
29.31 USD
-0.37 (-1.25%)
29.31 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to RTO. RTO was compared to 82 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 quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year RTO was profitable.
In the past year RTO had a positive cash flow from operations.
Each year in the past 5 years RTO has been profitable.
RTO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
RTO's Return On Assets of 2.38% is in line compared to the rest of the industry. RTO outperforms 58.54% of its industry peers.
With a Return On Equity value of 6.44%, RTO perfoms like the industry average, outperforming 58.54% of the companies in the same industry.
The Return On Invested Capital of RTO (4.74%) is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for RTO is below the industry average of 10.38%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.38% | ||
| ROE | 6.44% | ||
| ROIC | 4.74% |
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
Looking at the Profit Margin, with a value of 4.79%, RTO is in the better half of the industry, outperforming 63.41% of the companies in the same industry.
RTO's Profit Margin has declined in the last couple of years.
RTO's Operating Margin of 10.17% is fine compared to the rest of the industry. RTO outperforms 70.73% of its industry peers.
RTO's Operating Margin has improved in the last couple of years.
RTO has a Gross Margin of 87.69%. This is amongst the best in the industry. RTO outperforms 98.78% of its industry peers.
RTO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.17% | ||
| PM (TTM) | 4.79% | ||
| GM | 87.69% |
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.
RTO has about the same amout of shares outstanding than it did 1 year ago.
RTO has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, RTO has an improved debt to assets ratio.
2.2 Solvency
RTO has an Altman-Z score of 2.21. This is not the best score and indicates that RTO is in the grey zone with still 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 8.55. This is a slightly negative value and a sign of low solvency as RTO would need 8.55 years to pay back of all of its debts.
The Debt to FCF ratio of RTO (8.55) is better than 60.98% of its industry peers.
A Debt/Equity ratio of 1.00 indicates that RTO is somewhat dependend on debt financing.
The Debt to Equity ratio of RTO (1.00) is worse than 63.41% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 8.55 | ||
| Altman-Z | 2.21 |
ROIC/WACC0.63
WACC7.55%
2.3 Liquidity
A Current Ratio of 1.12 indicates that RTO should not have too much problems paying its short term obligations.
RTO has a worse Current ratio (1.12) than 73.17% of its industry peers.
A Quick Ratio of 1.03 indicates that RTO should not have too much problems paying its short term obligations.
RTO has a Quick ratio of 1.03. This is in the lower half of the industry: RTO underperforms 67.07% 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 -17.69%.
RTO shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.12% yearly.
The Revenue has grown by 18.65% in the past year. This is quite good.
RTO shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 22.23% yearly.
EPS 1Y (TTM)-17.69%
EPS 3Y5.61%
EPS 5Y8.12%
EPS Q2Q%-17.55%
Revenue 1Y (TTM)18.65%
Revenue growth 3Y35.81%
Revenue growth 5Y22.23%
Sales Q2Q%-4.12%
3.2 Future
The Earnings Per Share is expected to grow by 8.79% on average over the next years. This is quite good.
Based on estimates for the next years, RTO will show a quite strong growth in Revenue. The Revenue will grow by 9.48% on average per year.
EPS Next Y5.18%
EPS Next 2Y7.34%
EPS Next 3Y8.56%
EPS Next 5Y8.79%
Revenue Next Year6.36%
Revenue Next 2Y4.7%
Revenue Next 3Y4.71%
Revenue Next 5Y9.48%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same 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 30.53, which means the current valuation is very expensive for RTO.
RTO's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of RTO to the average of the S&P500 Index (26.91), we can say RTO is valued inline with the index average.
The Price/Forward Earnings ratio is 23.85, which indicates a rather expensive current valuation of RTO.
62.20% of the companies in the same industry are more expensive than RTO, based on the Price/Forward Earnings ratio.
RTO's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.53 | ||
| Fwd PE | 23.85 |
4.2 Price Multiples
RTO's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, RTO is valued a bit cheaper than 70.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.91 | ||
| EV/EBITDA | 13.69 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
RTO has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)5.89
PEG (5Y)3.76
EPS Next 2Y7.34%
EPS Next 3Y8.56%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.04%, RTO has a reasonable but not impressive dividend return.
RTO's Dividend Yield is rather good when compared to the industry average which is at 2.46. RTO pays more dividend than 84.15% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.32, RTO has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.04% |
5.2 History
On average, the dividend of RTO grows each year by 21.59%, which is quite nice.
RTO has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)21.59%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
95.51% of the earnings are spent on dividend by RTO. This is not a sustainable payout ratio.
The dividend of RTO is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP95.51%
EPS Next 2Y7.34%
EPS Next 3Y8.56%
29.31
-0.37 (-1.25%)
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 Cap14.74B
Revenue(TTM)7.08B
Net Income(TTM)339.24M
Analysts71.2
Price Target28.02 (-4.4%)
Short Float %0.74%
Short Ratio5.4
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.04% |
Yearly Dividend0.12
Dividend Growth(5Y)21.59%
DP95.51%
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)-4.99%
PT rev (3m)-0.26%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-2.33%
EPS NY rev (3m)-0.15%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-3.12%
Revenue NY rev (3m)-4.98%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.53 | ||
| Fwd PE | 23.85 | ||
| P/S | 2.08 | ||
| P/FCF | 20.91 | ||
| P/OCF | 14.73 | ||
| P/B | 2.8 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.69 |
EPS(TTM)0.96
EY3.28%
EPS(NY)1.23
Fwd EY4.19%
FCF(TTM)1.4
FCFY4.78%
OCF(TTM)1.99
OCFY6.79%
SpS14.08
BVpS10.48
TBVpS-7.33
PEG (NY)5.89
PEG (5Y)3.76
Graham Number15.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.38% | ||
| ROE | 6.44% | ||
| ROCE | 6.57% | ||
| ROIC | 4.74% | ||
| ROICexc | 5.54% | ||
| ROICexgc | 55.42% | ||
| OM | 10.17% | ||
| PM (TTM) | 4.79% | ||
| GM | 87.69% | ||
| FCFM | 9.95% |
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)6.26%
ROICexc(5y)8.09%
ROICexgc(3y)55.82%
ROICexgc(5y)64.73%
ROCE(3y)7.83%
ROCE(5y)9.4%
ROICexgc growth 3Y13.17%
ROICexgc growth 5Y12.96%
ROICexc growth 3Y-12.38%
ROICexc growth 5Y-7.05%
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 Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 8.55 | ||
| Debt/EBITDA | 3.86 | ||
| Cap/Depr | 46.46% | ||
| Cap/Sales | 4.18% | ||
| Interest Coverage | 2.6 | ||
| Cash Conversion | 73.73% | ||
| Profit Quality | 207.77% | ||
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.03 | ||
| Altman-Z | 2.21 |
F-Score5
WACC7.55%
ROIC/WACC0.63
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)-17.69%
EPS 3Y5.61%
EPS 5Y8.12%
EPS Q2Q%-17.55%
EPS Next Y5.18%
EPS Next 2Y7.34%
EPS Next 3Y8.56%
EPS Next 5Y8.79%
Revenue 1Y (TTM)18.65%
Revenue growth 3Y35.81%
Revenue growth 5Y22.23%
Sales Q2Q%-4.12%
Revenue Next Year6.36%
Revenue Next 2Y4.7%
Revenue Next 3Y4.71%
Revenue Next 5Y9.48%
EBIT growth 1Y3.51%
EBIT growth 3Y38.61%
EBIT growth 5Y27.38%
EBIT Next Year45.65%
EBIT Next 3Y18.76%
EBIT Next 5Y16.89%
FCF growth 1Y52.56%
FCF growth 3Y16.08%
FCF growth 5Y16.66%
OCF growth 1Y49.17%
OCF growth 3Y17.93%
OCF growth 5Y14.82%
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 3 / 10 to RENTOKIL INITIAL PLC-SP ADR (RTO). This can be considered as Overvalued.
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 30.53 and the Price/Book (PB) ratio is 2.8.
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 95.51%.