Rollins Post-Investor Day: More Questions Than Answers; Downgrading to Neutral; PT to $45

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Rollins Post-Investor Day: More Questions Than Answers; Downgrading to Neutral; PT to $45

J P M O R G A N North America Equity Research

24 July 2026

Rollins ▼Neutral

Previous: Overweight

Post-Investor Day: More Questions Than Answers; ROL, ROL US

Price (23 Jul 26):$39.44

Downgrading to Neutral; PT to $45 ▼Price Target (Dec-27):$45.00

Prior (Dec-26):$70.00

Post-Investor Day, the long-term thesis for Rollins remains intact, but near-term North America Small and Mid Cap

underwriting has become tougher as industry demand has turned unusually Industrials

volatile, complicating the balance between sustained investment and near-term Tomohiko Sano AC

margin protection. Even with a 99-quarter organic growth streak, results have not (1-212) 622-1099

consistently cleared an elevated market bar, and incremental margins have reset, tomohiko.sano@jpmorgan.com

with management now guiding to ≥10% for 2026 and a 4Q-weighted recovery Ethan Coyle

profile. Against that backdrop, we see a less attractive risk/reward versus our (1-212) 270-0613

coverage and are downgrading to Neutral (from Overweight) and establishing a ethan.coyle@jpmchase.com

Dec-27 PT of $45 (vs. our prior Dec-26 PT of $70). Brendan Shea, CFA

(1-212) 622-0770

• Key Questions: The “Why” on Demand and the “When” on Margins: The brendan.shea@jpmorgan.comJ.P. Morgan Securities LLC

quarter raised more questions than answers, in our view, centering on why

consumer-initiated demand softened so abruptly. Management attributed the

slowdown to a confluence of factors rather than a single cause, noting demand Key Changes (FYE Dec)

patterns more variable than any point in the better part of a decade, while Prev Cur Δ

retention remained strong. Management also highlighted LLM-related search Adj. EPS - 26E ($) 1.24 1.17 -5.5%