RENTOKIL INITIAL PLC-SP ADR (RTO) Stock Fundamental Analysis
USA - NYSE:RTO - US7601251041 - ADR
26.25 USD
-0.07 (-0.27%)
26.15 USD
-0.1 (-0.38%)
Taking everything into account, RTO scores 5 out of 10 in our fundamental rating. RTO was compared to 82 industry peers in the Commercial Services & Supplies industry. There are concerns on the financial health of RTO while its profitability can be described as average. RTO has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year RTO was profitable.
RTO had a positive operating cash flow in the past year.
In the past 5 years RTO has always been profitable.
In the past 5 years RTO always reported a positive cash flow from operatings.
1.2 Ratios
RTO has a Return On Assets of 2.36%. This is comparable to the rest of the industry: RTO outperforms 54.88% of its industry peers.
RTO has a Return On Equity (6.38%) which is comparable to the rest of the industry.
RTO has a Return On Invested Capital (4.69%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for RTO is below the industry average of 10.46%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.36% | ||
| ROE | 6.38% | ||
| ROIC | 4.69% |
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 62.20% of its industry peers.
In the last couple of years the Profit Margin of RTO has declined.
With a decent Operating Margin value of 10.17%, RTO is doing good in the industry, outperforming 71.95% of the companies in the same industry.
RTO's Operating Margin has improved in the last couple of years.
RTO has a better Gross Margin (86.86%) than 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) | 4.8% | ||
| GM | 86.86% |
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.
Compared to 5 years ago, RTO has more shares outstanding
Compared to 1 year ago, RTO has an improved debt to assets ratio.
2.2 Solvency
RTO has an Altman-Z score of 2.09. 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.
Looking at the Altman-Z score, with a value of 2.09, RTO is in line with its industry, outperforming 47.56% of the companies in the same industry.
RTO has a debt to FCF ratio of 8.70. This is a slightly negative value and a sign of low solvency as RTO would need 8.70 years to pay back of all of its debts.
With a Debt to FCF ratio value of 8.70, RTO perfoms like the industry average, outperforming 59.76% of the companies in the same industry.
RTO has a Debt/Equity ratio of 1.00. This is a neutral value indicating RTO is somewhat dependend on debt financing.
RTO has a Debt to Equity ratio of 1.00. This is in the lower half of the industry: RTO underperforms 62.20% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 8.7 | ||
| Altman-Z | 2.09 |
ROIC/WACC0.63
WACC7.43%
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 70.73% 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.
Looking at the Quick ratio, with a value of 1.03, RTO is doing worse than 64.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.03 |
3. Growth
3.1 Past
RTO shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.45%.
Measured over the past years, RTO shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.83% on average per year.
RTO shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 17.42%.
Measured over the past years, RTO shows a very strong growth in Revenue. The Revenue has been growing by 21.74% on average per year.
EPS 1Y (TTM)6.45%
EPS 3Y10.05%
EPS 5Y10.83%
EPS Q2Q%6.87%
Revenue 1Y (TTM)17.42%
Revenue growth 3Y34.91%
Revenue growth 5Y21.74%
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 5.96% on average per year.
Based on estimates for the next years, RTO will show a small growth in Revenue. The Revenue will grow by 4.66% on average per year.
EPS Next Y26.65%
EPS Next 2Y18.25%
EPS Next 3Y15.78%
EPS Next 5Y5.96%
Revenue Next Year11.71%
Revenue Next 2Y7.38%
Revenue Next 3Y6.47%
Revenue Next 5Y4.66%
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
With a Price/Earnings ratio of 21.00, RTO is valued on the expensive side.
Based on the Price/Earnings ratio, RTO is valued a bit cheaper than 62.20% of the companies in the same industry.
When comparing the Price/Earnings ratio of RTO to the average of the S&P500 Index (25.51), we can say RTO is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 15.56, the valuation of RTO can be described as correct.
Based on the Price/Forward Earnings ratio, RTO is valued a bit cheaper than 74.39% of the companies in the same industry.
RTO is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21 | ||
| Fwd PE | 15.56 |
4.2 Price Multiples
RTO's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, RTO is valued a bit cheaper than the industry average as 71.95% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.07 | ||
| EV/EBITDA | 12.61 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of RTO may justify a higher PE ratio.
A more expensive valuation may be justified as RTO's earnings are expected to grow with 15.78% in the coming years.
PEG (NY)0.79
PEG (5Y)1.94
EPS Next 2Y18.25%
EPS Next 3Y15.78%
5. Dividend
5.1 Amount
RTO has a Yearly Dividend Yield of 2.24%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.55, RTO pays a better dividend. On top of this RTO pays more dividend than 84.15% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, RTO has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.24% |
5.2 History
On average, the dividend of RTO grows each year by 21.12%, which is quite nice.
RTO has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)21.12%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
94.52% 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.
DP94.52%
EPS Next 2Y18.25%
EPS Next 3Y15.78%
26.25
-0.07 (-0.27%)
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 Cap13.20B
Revenue(TTM)7.01B
Net Income(TTM)336.24M
Analysts76.8
Price Target30.06 (14.51%)
Short Float %0.7%
Short Ratio4.72
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.24% |
Yearly Dividend0.12
Dividend Growth(5Y)21.12%
DP94.52%
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)7.25%
PT rev (3m)8.81%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)36.23%
EPS NY rev (3m)35.44%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)32.66%
Revenue NY rev (3m)24.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21 | ||
| Fwd PE | 15.56 | ||
| P/S | 1.88 | ||
| P/FCF | 19.07 | ||
| P/OCF | 13.44 | ||
| P/B | 2.51 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.61 |
EPS(TTM)1.25
EY4.76%
EPS(NY)1.69
Fwd EY6.43%
FCF(TTM)1.38
FCFY5.24%
OCF(TTM)1.95
OCFY7.44%
SpS13.94
BVpS10.48
TBVpS-7.33
PEG (NY)0.79
PEG (5Y)1.94
Graham Number17.17
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.36% | ||
| ROE | 6.38% | ||
| ROCE | 6.5% | ||
| ROIC | 4.69% | ||
| ROICexc | 5.48% | ||
| ROICexgc | 54.84% | ||
| OM | 10.17% | ||
| PM (TTM) | 4.8% | ||
| GM | 86.86% | ||
| FCFM | 9.88% |
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)56.79%
ROICexgc(5y)65.31%
ROCE(3y)7.83%
ROCE(5y)9.4%
ROICexgc growth 3Y13.81%
ROICexgc growth 5Y13.34%
ROICexc growth 3Y-12.34%
ROICexc growth 5Y-7.02%
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 | 8.7 | ||
| Debt/EBITDA | 3.92 | ||
| Cap/Depr | 46.49% | ||
| Cap/Sales | 4.14% | ||
| Interest Coverage | 2.62 | ||
| Cash Conversion | 73.49% | ||
| Profit Quality | 205.91% | ||
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.03 | ||
| Altman-Z | 2.09 |
F-Score5
WACC7.43%
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)6.45%
EPS 3Y10.05%
EPS 5Y10.83%
EPS Q2Q%6.87%
EPS Next Y26.65%
EPS Next 2Y18.25%
EPS Next 3Y15.78%
EPS Next 5Y5.96%
Revenue 1Y (TTM)17.42%
Revenue growth 3Y34.91%
Revenue growth 5Y21.74%
Sales Q2Q%24.28%
Revenue Next Year11.71%
Revenue Next 2Y7.38%
Revenue Next 3Y6.47%
Revenue Next 5Y4.66%
EBIT growth 1Y2.43%
EBIT growth 3Y37.69%
EBIT growth 5Y26.87%
EBIT Next Year45.65%
EBIT Next 3Y18.76%
EBIT Next 5Y16.7%
FCF growth 1Y49.86%
FCF growth 3Y15.31%
FCF growth 5Y16.19%
OCF growth 1Y46.44%
OCF growth 3Y17.15%
OCF growth 5Y14.36%
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 21 and the Price/Book (PB) ratio is 2.51.
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 94.52%.