Rollins Inc (ROL.N): Q2 earnings and growth miss, but not a complete surprise

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Rollins Inc (ROL.N): Q2 earnings and growth miss, but not a complete surprise

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22 Jul 2026 17:35:42 ET │ 10 pages

Rollins Inc (ROL.N)

Q2 earnings and growth miss, but not a complete surprise

CITI'S TAKE

Neutral Q2 adj EBITDA of $236.3m 8% below VA consensus of $255.63, with a

margin of 21.9%, down 120bps YoY (Q1 was down 110bps), and well below Price (22 Jul 26 16:00) US$43.47

consensus of 23.4%. Q2 LFL revenue growth of 5.7% compares with Target price US$46.00

management's target organic growth of 7-8% and Q1 growth of 6.6%. Expected share price return 5.8%

Rollins comments that demand softened during the quarter, whilst they Expected dividend yield 1.6%

had a cost structure set for a stronger growth backdrop entering peak Expected total return 7.5%

season, which hurt their margin performance. Management is taking

Market Cap US$20,929M remedial action to better align their cost structure with current demand

conditions. This is not a shock earnings miss as management had already

talked cautiously about Q2 trading at recent Investor Conferences.

Marc Van'T SantAC

Growth trajectory — Rollins delivered 6.6% LFL growth in Q1, but with a March exit +44-20-7986-4059

rate of greater than 8%. Based on 5.7% Q2 LFL growth, we think this could imply a marc.vantsant@citi.com

June exit rate of c4%, a rapid intra quarter deterioration. An exit rate of 4% probably Arthur Truslove

suggests flat volumes given a pricing tailwind of 3-4%. The US consumer seems to

+44-20-7986-4058

have weakened sequentially, but it'll be interesting to see if there is any reference by

arthur.truslove@citi.com

management on the conference call tomorrow about increased customer churn due

to high pricing and / or the impact from recent FTC action. All business lines slowed, Saifabbas Sayed