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RENTOKIL INITIAL PLC-SP ADR (RTO) Stock Fundamental Analysis

NYSE:RTO - New York Stock Exchange, Inc. - US7601251041 - ADR - Currency: USD

24.11  +0.12 (+0.5%)

After market: 24.11 0 (0%)

Fundamental Rating

4

Taking everything into account, RTO scores 4 out of 10 in our fundamental rating. RTO was compared to 83 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 is not valued too expensively and it also shows a decent growth rate.


Dividend Valuation Growth Profitability Health

6

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.
RTO had positive earnings in each of the past 5 years.
In the past 5 years RTO always reported a positive cash flow from operatings.
RTO Yearly Net Income VS EBIT VS OCF VS FCFRTO Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M 400M 600M

1.2 Ratios

RTO has a Return On Assets (2.91%) which is comparable to the rest of the industry.
RTO has a Return On Equity of 7.26%. This is in the better half of the industry: RTO outperforms 61.45% of its industry peers.
RTO's Return On Invested Capital of 6.63% is in line compared to the rest of the industry. RTO outperforms 57.83% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for RTO is significantly below the industry average of 11.67%.
The 3 year average ROIC (5.49%) for RTO is below the current ROIC(6.63%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 2.91%
ROE 7.26%
ROIC 6.63%
ROA(3y)2.76%
ROA(5y)3.54%
ROE(3y)7.41%
ROE(5y)11.9%
ROIC(3y)5.49%
ROIC(5y)6.1%
RTO Yearly ROA, ROE, ROICRTO Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 40 60

1.3 Margins

With a decent Profit Margin value of 5.65%, RTO is doing good in the industry, outperforming 67.47% of the companies in the same industry.
RTO's Profit Margin has declined in the last couple of years.
The Operating Margin of RTO (12.71%) is better than 78.31% of its industry peers.
In the last couple of years the Operating Margin of RTO has grown nicely.
RTO has a Gross Margin of 83.87%. This is amongst the best in the industry. RTO outperforms 97.59% of its industry peers.
In the last couple of years the Gross Margin of RTO has remained more or less at the same level.
Industry RankSector Rank
OM 12.71%
PM (TTM) 5.65%
GM 83.87%
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%
RTO Yearly Profit, Operating, Gross MarginsRTO Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 40 60 80

2

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.
RTO Yearly Shares OutstandingRTO Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M 500M
RTO Yearly Total Debt VS Total AssetsRTO Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B 10B

2.2 Solvency

RTO has an Altman-Z score of 2.07. 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.
The Altman-Z score of RTO (2.07) is comparable to the rest of the industry.
The Debt to FCF ratio of RTO is 8.87, which is on the high side as it means it would take RTO, 8.87 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of RTO (8.87) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.67 indicates that RTO is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.67, RTO is in line with its industry, outperforming 43.37% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.67
Debt/FCF 8.87
Altman-Z 2.07
ROIC/WACC0.87
WACC7.62%
RTO Yearly LT Debt VS Equity VS FCFRTO Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

2.3 Liquidity

A Current Ratio of 0.81 indicates that RTO may have some problems paying its short term obligations.
RTO has a worse Current ratio (0.81) than 84.34% of its industry peers.
A Quick Ratio of 0.72 indicates that RTO may have some problems paying its short term obligations.
RTO has a Quick ratio of 0.72. This is amonst the worse of the industry: RTO underperforms 84.34% of its industry peers.
Industry RankSector Rank
Current Ratio 0.81
Quick Ratio 0.72
RTO Yearly Current Assets VS Current LiabilitesRTO Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B

4

3. Growth

3.1 Past

RTO shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -8.19%.
Measured over the past years, RTO shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.12% on average per year.
Looking at the last year, RTO shows a small growth in Revenue. The Revenue has grown by 1.13% in the last year.
RTO shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.90% yearly.
EPS 1Y (TTM)-8.19%
EPS 3Y5.61%
EPS 5Y8.12%
EPS Q2Q%-17.82%
Revenue 1Y (TTM)1.13%
Revenue growth 3Y22.51%
Revenue growth 5Y14.9%
Sales Q2Q%0.96%

3.2 Future

RTO is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.44% yearly.
RTO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.87% yearly.
EPS Next Y5.54%
EPS Next 2Y7.57%
EPS Next 3Y8.44%
EPS Next 5YN/A
Revenue Next Year11.94%
Revenue Next 2Y8.01%
Revenue Next 3Y6.88%
Revenue Next 5Y3.87%

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.
RTO Yearly Revenue VS EstimatesRTO Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2B 4B 6B 8B
RTO Yearly EPS VS EstimatesRTO Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0.2 0.4 0.6 0.8 1

5

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 16.63, RTO is valued correctly.
Compared to the rest of the industry, the Price/Earnings ratio of RTO indicates a somewhat cheap valuation: RTO is cheaper than 73.49% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.45. RTO is valued slightly cheaper when compared to this.
RTO is valuated correctly with a Price/Forward Earnings ratio of 15.70.
Based on the Price/Forward Earnings ratio, RTO is valued a bit cheaper than the industry average as 73.49% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of RTO to the average of the S&P500 Index (21.90), we can say RTO is valued slightly cheaper.
Industry RankSector Rank
PE 16.63
Fwd PE 15.7
RTO Price Earnings VS Forward Price EarningsRTO Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of RTO indicates a somewhat cheap valuation: RTO is cheaper than 68.67% of the companies listed in the same industry.
RTO's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. RTO is cheaper than 68.67% of the companies in the same industry.
Industry RankSector Rank
P/FCF 19.16
EV/EBITDA 10.32
RTO Per share dataRTO EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 10

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)3
PEG (5Y)2.05
EPS Next 2Y7.57%
EPS Next 3Y8.44%

5

5. Dividend

5.1 Amount

RTO has a Yearly Dividend Yield of 2.57%. Purely for dividend investing, there may be better candidates out there.
RTO's Dividend Yield is rather good when compared to the industry average which is at 2.43. RTO pays more dividend than 86.75% of the companies in the same industry.
RTO's Dividend Yield is comparable with the S&P500 average which is at 2.42.
Industry RankSector Rank
Dividend Yield 2.57%

5.2 History

The dividend of RTO is nicely growing with an annual growth rate of 14.30%!
RTO has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)14.3%
Div Incr Years0
Div Non Decr Years0
RTO Yearly Dividends per shareRTO Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2021 2022 2023 2024 2025 0 0 0 0 0

5.3 Sustainability

74.59% 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.
DP74.59%
EPS Next 2Y7.57%
EPS Next 3Y8.44%
RTO Yearly Income VS Free CF VS DividendRTO Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M 400M 600M
RTO Dividend Payout.RTO Dividend Payout, showing the Payout Ratio.RTO Dividend Payout.PayoutRetained Earnings

RENTOKIL INITIAL PLC-SP ADR

NYSE:RTO (7/3/2025, 8:07:22 PM)

After market: 24.11 0 (0%)

24.11

+0.12 (+0.5%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)04-17 2025-04-17/bmo
Earnings (Next)07-31 2025-07-31
Inst Owners95.16%
Inst Owner ChangeN/A
Ins Owners0.62%
Ins Owner ChangeN/A
Market Cap12.13B
Analysts72.5
Price Target28.7 (19.04%)
Short Float %0.31%
Short Ratio2.06
Dividend
Industry RankSector Rank
Dividend Yield 2.57%
Yearly Dividend0.62
Dividend Growth(5Y)14.3%
DP74.59%
Div Incr Years0
Div Non Decr Years0
Ex-Date04-03 2025-04-03 (0.0593)
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)1.34%
PT rev (3m)-2.2%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)-1.27%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)7.91%
Valuation
Industry RankSector Rank
PE 16.63
Fwd PE 15.7
P/S 1.63
P/FCF 19.16
P/OCF 13.08
P/B 2.1
P/tB N/A
EV/EBITDA 10.32
EPS(TTM)1.45
EY6.01%
EPS(NY)1.54
Fwd EY6.37%
FCF(TTM)1.26
FCFY5.22%
OCF(TTM)1.84
OCFY7.64%
SpS14.78
BVpS11.5
TBVpS-7.83
PEG (NY)3
PEG (5Y)2.05
Profitability
Industry RankSector Rank
ROA 2.91%
ROE 7.26%
ROCE 8.66%
ROIC 6.63%
ROICexc 7.5%
ROICexgc N/A
OM 12.71%
PM (TTM) 5.65%
GM 83.87%
FCFM 8.52%
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)6.5%
ROICexc(5y)8.24%
ROICexgc(3y)80.52%
ROICexgc(5y)79.55%
ROCE(3y)7.83%
ROCE(5y)9.4%
ROICexcg growth 3Y27.39%
ROICexcg growth 5Y21.27%
ROICexc growth 3Y-11.58%
ROICexc growth 5Y-6.54%
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-Score6
Asset Turnover0.52
Health
Industry RankSector Rank
Debt/Equity 0.67
Debt/FCF 8.87
Debt/EBITDA 2.41
Cap/Depr 45.07%
Cap/Sales 3.96%
Interest Coverage 3.84
Cash Conversion 58.05%
Profit Quality 150.81%
Current Ratio 0.81
Quick Ratio 0.72
Altman-Z 2.07
F-Score6
WACC7.62%
ROIC/WACC0.87
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)-8.19%
EPS 3Y5.61%
EPS 5Y8.12%
EPS Q2Q%-17.82%
EPS Next Y5.54%
EPS Next 2Y7.57%
EPS Next 3Y8.44%
EPS Next 5YN/A
Revenue 1Y (TTM)1.13%
Revenue growth 3Y22.51%
Revenue growth 5Y14.9%
Sales Q2Q%0.96%
Revenue Next Year11.94%
Revenue Next 2Y8.01%
Revenue Next 3Y6.88%
Revenue Next 5Y3.87%
EBIT growth 1Y1.17%
EBIT growth 3Y25.03%
EBIT growth 5Y19.74%
EBIT Next Year55.17%
EBIT Next 3Y21.26%
EBIT Next 5Y12.96%
FCF growth 1Y-11.98%
FCF growth 3Y4.71%
FCF growth 5Y9.66%
OCF growth 1Y-8.01%
OCF growth 3Y6.38%
OCF growth 5Y7.93%