RENTOKIL INITIAL PLC-SP ADR (RTO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:RTO - US7601251041 - ADR
29.75 USD
-0.21 (-0.7%)
29.75 USD
0 (0%)
Taking everything into account, RTO scores 5 out of 10 in our fundamental rating. RTO was compared to 80 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
RTO had positive earnings in the past year.
In the past year RTO had a positive cash flow from operations.
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.
1.2 Ratios
RTO's Return On Assets of 2.35% is in line compared to the rest of the industry. RTO outperforms 59.26% of its industry peers.
The Return On Equity of RTO (6.35%) is comparable to the rest of the industry.
With a Return On Invested Capital value of 4.66%, RTO perfoms like the industry average, outperforming 55.56% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for RTO is below the industry average of 10.33%.
| 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
The Profit Margin of RTO (4.80%) is better than 65.43% 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 71.60% of its industry peers.
In the last couple of years the Operating Margin of RTO has grown nicely.
Looking at the Gross Margin, with a value of 86.40%, RTO belongs to the top of the industry, outperforming 98.77% 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.
The number of shares outstanding for RTO remains at a similar level compared to 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
An Altman-Z score of 2.20 indicates that RTO is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.20, RTO perfoms like the industry average, outperforming 53.09% of the companies in the same industry.
RTO has a debt to FCF ratio of 8.79. This is a slightly negative value and a sign of low solvency as RTO would need 8.79 years to pay back of all of its debts.
The Debt to FCF ratio of RTO (8.79) is better than 64.20% of its industry peers.
A Debt/Equity ratio of 1.00 indicates that 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 60.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1 | ||
| Debt/FCF | 8.79 | ||
| Altman-Z | 2.2 |
ROIC/WACC0.61
WACC7.6%
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 70.37% of its industry peers.
RTO has a Quick Ratio of 1.03. This is a normal value and indicates that RTO is financially healthy and should not expect problems in meeting its short term obligations.
RTO has a worse Quick ratio (1.03) than 65.43% of its industry peers.
| 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.
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)6.45%
EPS 3Y10.05%
EPS 5Y10.83%
EPS Q2Q%6.87%
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 5.96% on average per year.
The Revenue is expected to grow by 5.94% on average over the next years.
EPS Next Y26.44%
EPS Next 2Y18.19%
EPS Next 3Y15.76%
EPS Next 5Y5.96%
Revenue Next Year14.3%
Revenue Next 2Y8.62%
Revenue Next 3Y7.27%
Revenue Next 5Y5.94%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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 23.80, RTO is valued on the expensive side.
64.20% of the companies in the same industry are more expensive than RTO, based on the Price/Earnings ratio.
RTO is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.39, which is the current average of the S&P500 Index.
RTO is valuated rather expensively with a Price/Forward Earnings ratio of 17.65.
Based on the Price/Forward Earnings ratio, RTO is valued a bit cheaper than the industry average as 74.07% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 23.84. RTO is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.8 | ||
| Fwd PE | 17.65 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as RTO.
Based on the Price/Free Cash Flow ratio, RTO is valued a bit cheaper than the industry average as 71.60% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.82 | ||
| EV/EBITDA | 14.04 |
4.3 Compensation for Growth
RTO's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
RTO has a very decent profitability rating, which may justify a higher PE ratio.
RTO's earnings are expected to grow with 15.76% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.9
PEG (5Y)2.2
EPS Next 2Y18.19%
EPS Next 3Y15.76%
5. Dividend
5.1 Amount
RTO has a Yearly Dividend Yield of 2.01%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 0.89, RTO pays a better dividend. On top of this RTO pays more dividend than 83.95% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 1.87, RTO has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.01% |
5.2 History
On average, the dividend of RTO grows each year by 20.86%, which is quite nice.
RTO has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)20.86%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
93.98% 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.
DP93.98%
EPS Next 2Y18.19%
EPS Next 3Y15.76%
29.75
-0.21 (-0.7%)
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 Cap14.96B
Revenue(TTM)6.97B
Net Income(TTM)334.62M
Analysts76.92
Price Target30.84 (3.66%)
Short Float %0.62%
Short Ratio3.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.01% |
Yearly Dividend0.12
Dividend Growth(5Y)20.86%
DP93.98%
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)2.6%
PT rev (3m)4.55%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-0.17%
EPS NY rev (3m)32.84%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)2.32%
Revenue NY rev (3m)31.49%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.8 | ||
| Fwd PE | 17.65 | ||
| P/S | 2.15 | ||
| P/FCF | 21.82 | ||
| P/OCF | 15.38 | ||
| P/B | 2.84 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.04 |
EPS(TTM)1.25
EY4.2%
EPS(NY)1.69
Fwd EY5.67%
FCF(TTM)1.36
FCFY4.58%
OCF(TTM)1.93
OCFY6.5%
SpS13.86
BVpS10.48
TBVpS-7.33
PEG (NY)0.9
PEG (5Y)2.2
Graham Number17.17
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.35% | ||
| ROE | 6.35% | ||
| ROCE | 6.46% | ||
| ROIC | 4.66% | ||
| ROICexc | 5.45% | ||
| ROICexgc | 54.53% | ||
| OM | 10.17% | ||
| PM (TTM) | 4.8% | ||
| GM | 86.4% | ||
| FCFM | 9.84% |
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)57.35%
ROICexgc(5y)65.65%
ROCE(3y)7.83%
ROCE(5y)9.4%
ROICexgc growth 3Y14.17%
ROICexgc growth 5Y13.56%
ROICexc growth 3Y-12.32%
ROICexc growth 5Y-7.01%
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 | 8.79 | ||
| Debt/EBITDA | 3.95 | ||
| Cap/Depr | 46.51% | ||
| Cap/Sales | 4.12% | ||
| Interest Coverage | 2.63 | ||
| Cash Conversion | 73.35% | ||
| Profit Quality | 204.88% | ||
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.03 | ||
| Altman-Z | 2.2 |
F-Score5
WACC7.6%
ROIC/WACC0.61
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 Y26.44%
EPS Next 2Y18.19%
EPS Next 3Y15.76%
EPS Next 5Y5.96%
Revenue 1Y (TTM)16.75%
Revenue growth 3Y34.42%
Revenue growth 5Y21.48%
Sales Q2Q%24.28%
Revenue Next Year14.3%
Revenue Next 2Y8.62%
Revenue Next 3Y7.27%
Revenue Next 5Y5.94%
EBIT growth 1Y1.85%
EBIT growth 3Y37.18%
EBIT growth 5Y26.6%
EBIT Next Year53.86%
EBIT Next 3Y20.84%
EBIT Next 5Y13.37%
FCF growth 1Y48.39%
FCF growth 3Y14.89%
FCF growth 5Y15.93%
OCF growth 1Y44.96%
OCF growth 3Y16.72%
OCF growth 5Y14.11%
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 23.8 and the Price/Book (PB) ratio is 2.84.
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 93.98%.