Reasons Why You Should Retain Rollins Stock in Your Portfolio Now

Rollins, Inc. ROL has had an impressive year-to-date run. The stock rallied 24% compared with the industry's 26% growth.

The company has an impressive Growth Score of A. This style score condenses all the essential metrics from a company’s financial statements to get a true sense of the quality and sustainability of its growth.

The company’s 2025 and 2026 earnings are expected to increase 10% and 11%, respectively, year over year.

ROL Thrives on Growth, Efficiency and Acquisitions

Rollins, a leading pest and termite control services provider, is benefiting from a strong demand environment across its business segments. In the first quarter of 2025, the company reported a 10% year-over-year revenue increase. Growth was observed across its key segments, residential (8%), commercial (10%), and termite and ancillary (13%).

The company has strategically developed its operational platform to enhance cross-selling opportunities, improve cost efficiency and provide quick and effective customer service. Rollins' real-time service tracking and customer communication technologies offer a competitive edge, ensuring better service delivery and customer satisfaction.

Additionally, its proprietary Branch Operating Support System supports service tracking, payment processing and virtual route management. These tools help optimize route efficiency, reduce costs and boost customer retention through swift and reliable services.

Acquisitions continue to play a pivotal role in Rollins' expansion strategy. These efforts have significantly bolstered the company’s global presence and revenue growth. Currently operating in approximately 70 countries, Rollins has completed 44 acquisitions in 2024, 24 in 2023, 31 in 2022 and 39 in 2021.

Rollins also demonstrates its commitment to shareholders through consistent dividend payments, reflecting confidence in business performance. The company paid dividends of $298 million, $264.3 million, $211.6 million and $208.7 million in 2024, 2023, 2022 and 2021, respectively.

ROL’s Liquidity Position Remains Below Average

Rollins’ current ratio (a measure of liquidity) at the end of the first quarter was pegged at 0.87, which was lower than the industry's 0.88. A current ratio of less than one indicates that the company may have problems paying off its short-term obligations.

ROL’s Zacks Rank & Stocks to Consider

Rollins currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader Zacks Business-Services sector are Limbach LMB and Qifu Technology QFIN, each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Limbach has a long-term earnings growth expectation of 12%. LMB delivered a trailing four-quarter earnings surprise of 91.2%, on average.

Qifu Technology has a long-term earnings growth expectation of 11.3%. QFIN delivered a trailing four-quarter earnings surprise of 14.3%, on average.

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This article originally published on Zacks Investment Research (zacks.com).

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