RENTOKIL INITIAL PLC-SP ADR (RTO) Stock Fundamental Analysis
USA • New York Stock Exchange • NYSE:RTO • US7601251041
31.64 USD
-0.59 (-1.83%)
Last: Jan 30, 2026, 02:16 PM
We assign a fundamental rating of 5 out of 10 to RTO. RTO was compared to 80 industry peers in the Commercial Services & Supplies industry. RTO has a medium profitability rating, but doesn't score so well on its financial health evaluation. RTO has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year RTO was profitable.
- RTO had a positive operating cash flow in the past year.
- RTO had positive earnings in each of the past 5 years.
- RTO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- The Return On Assets of RTO (2.35%) is comparable to the rest of the industry.
- RTO has a Return On Equity (6.35%) which is in line with its industry peers.
- RTO has a Return On Invested Capital (4.66%) which is in line with its industry peers.
- The Average Return On Invested Capital over the past 3 years for RTO is significantly below the industry average of 10.58%.
| 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
- RTO has a Profit Margin of 4.80%. This is in the better half of the industry: RTO outperforms 65.00% of its industry peers.
- In the last couple of years the Profit Margin of RTO has declined.
- RTO has a better Operating Margin (10.17%) than 68.75% of its industry peers.
- RTO's Operating Margin has improved in the last couple of years.
- Looking at the Gross Margin, with a value of 86.40%, RTO belongs to the top of the industry, outperforming 98.75% 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
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RTO 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.
- RTO has a better debt/assets ratio than last year.
2.2 Solvency
- RTO has an Altman-Z score of 2.28. 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 (2.28) which is comparable to the rest of the industry.
- The Debt to FCF ratio of RTO is 8.79, which is on the high side as it means it would take RTO, 8.79 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of RTO (8.79) is better than 63.75% of its industry peers.
- RTO has a Debt/Equity ratio of 1.00. This is a neutral value indicating RTO is somewhat dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 1.00, RTO is doing worse than 62.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 8.79 | ||
| Altman-Z | 2.28 |
ROIC/WACC0.61
WACC7.7%
2.3 Liquidity
- A Current Ratio of 1.12 indicates that RTO should not have too much problems paying its short term obligations.
- RTO's Current ratio of 1.12 is on the low side compared to the rest of the industry. RTO is outperformed by 70.00% of its industry peers.
- 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 66.25% 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%.
- The Earnings Per Share has been growing by 8.17% on average over the past years. This is quite good.
- The Revenue has grown by 16.75% in the past year. This is quite good.
- The Revenue has been growing by 21.48% on average over the past years. This is a very strong growth!
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
- Based on estimates for the next years, RTO will show a small growth in Earnings Per Share. The EPS will grow by 3.43% on average per year.
- Based on estimates for the next years, RTO will show a small growth in Revenue. The Revenue will grow by 5.57% on average per year.
EPS Next Y11.5%
EPS Next 2Y10.86%
EPS Next 3Y10.96%
EPS Next 5Y3.43%
Revenue Next Year13.41%
Revenue Next 2Y8.21%
Revenue Next 3Y6.99%
Revenue Next 5Y5.57%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last 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
- A Price/Earnings ratio of 25.31 indicates a quite expensive valuation of RTO.
- Compared to the rest of the industry, the Price/Earnings ratio of RTO indicates a somewhat cheap valuation: RTO is cheaper than 62.50% of the companies listed in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 28.39, RTO is valued at the same level.
- Based on the Price/Forward Earnings ratio of 18.91, the valuation of RTO can be described as rather expensive.
- 75.00% of the companies in the same industry are more expensive than RTO, based on the Price/Forward Earnings ratio.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.72, RTO is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.31 | ||
| Fwd PE | 18.91 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as RTO.
- RTO's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. RTO is cheaper than 70.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.21 | ||
| EV/EBITDA | 14.98 |
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)2.2
PEG (5Y)3.1
EPS Next 2Y10.86%
EPS Next 3Y10.96%
5. Dividend
5.1 Amount
- RTO has a Yearly Dividend Yield of 1.88%.
- RTO's Dividend Yield is rather good when compared to the industry average which is at 0.82. RTO pays more dividend than 86.25% of the companies in the same industry.
- RTO's Dividend Yield is comparable with the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.88% |
5.2 History
- The dividend of RTO is nicely growing with an annual growth rate of 20.86%!
- 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
- RTO pays out 93.98% of its income as dividend. 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 2Y10.86%
EPS Next 3Y10.96%
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.
Can you provide the valuation status for RENTOKIL INITIAL PLC-SP ADR?
ChartMill assigns a valuation rating of 4 / 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.
What are the PE and PB ratios of RENTOKIL INITIAL PLC-SP ADR (RTO) stock?
The Price/Earnings (PE) ratio for RENTOKIL INITIAL PLC-SP ADR (RTO) is 25.31 and the Price/Book (PB) ratio is 3.02.
What is the financial health of RENTOKIL INITIAL PLC-SP ADR (RTO) stock?
The financial health rating of RENTOKIL INITIAL PLC-SP ADR (RTO) is 3 / 10.