Rollins Inc.: Still a little bugged by demand; Maintain Underperform

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Rollins Inc.: Still a little bugged by demand; Maintain Underperform

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Rollins Inc.

Still a little bugged by demand; Maintain

Underperform

Maintain Rating: UNDERPERFORM | PO: 35.00 USD | Price: 39.44 USD

Rollins misses 2Q on Resi demand softness 23 July 2026

Following our downgrade of Rollins (see report), we provide a post earnings call Equity

summary of 2Q26. ROL reported 2Q26 revenue/adj. EBITDA of $1.08bn/$236mn, below

our estimates of $1.09bn/$250mn and Street at $1.09bn/$256mn and primarily driven Curtis Nagle, CFA

by weaker organic resi growth (3.6% vs. Street at 5.4%). Mgmt. noted no single factor ResearchBofAS Analyst

behind the slowdown in Resi demand in May and much of June. Instead, mgmt. pointed c.nagle@bofa.com

to a mix of weaker search activity, weather-related impacts on pest activity (possibly the Ryan Rivera

lagging impact of a colder than normal winter), softer one-time service demand, and ResearchBofAS Analyst

possibly broader market dynamics such as elevated gas prices and weak consumer ryan.rivera4@bofa.com

sentiment. While lead trends improved exiting June and into July, mgmt. did not provide

quantify June exit rates or July MTD for demand/revenue trends, which we see as

appropriately conservative given high volatility in month-to-month trends this year. Stock Data

Price 39.44 USDNon-Resi businesses (mostly) hold up

Despite Resi weakness, several aspects of the underlying story remained constructive. Price Objective 35.00 USD

Mgmt. noted no meaningful pushback to pricing and continued strength in customer Date Established 23-Jul-2026

retention, suggesting pressure remains concentrated within new customer acquisition Investment Opinion B-3-7

rather than the recurring revenue base.