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Why Is Rollins (ROL) Up 7.5% Since Last Earnings Report?
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It has been about a month since the last earnings report for Rollins (ROL - Free Report) . Shares have added about 7.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Rollins due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Rollins Q2 Earnings Meet Estimates
Rollins, Inc. second-quarter 2024 earnings met the Zacks Consensus Estimate but revenues beat the same.
Adjusted earnings of 27 cents per share increased 17.4% year over year. Revenues of $891.9 million beat the consensus mark by a slight margin and improved 8.7% year over year. Organic revenues of $877.8 million increased 7.7% year over year. Rollins’ performance in the quarter was positively impacted by a healthy demand environment for its services.
Quarter Details
Residential revenues increased 6.3% year over year to $408.4 million and beat our estimate of $401.9 million. Commercial revenues increased 9.9% year over year to $287.8 million and surpassed our estimate of $283.7 million. Termite and ancillary revenues increased 11.8% year over year to $186 million and missed our estimate of $187.7 million.
Adjusted EBITDA of $210 million increased 15.3% year over year. This compares to our expectation of an adjusted EBITDA of $206.4 million, up 14.6% year over year. Adjusted EBITDA margin of 23.6% increased 140 basis points (bps) year over year compared with our expectation of an adjusted EBITDA margin of 23.4%, up 110 bps year over year.
Rollins exited the quarter with a cash and cash equivalents balance of $106.7 million compared with the prior quarter’s $113 million. Long-term debt at the end of the quarter was $502 million compared with $510.9 million at the end of the prior quarter.
The company generated $145.1 million of cash from operating activities in the quarter and capital expenditure was $8.7 million. Free cash flow came in at $136.4 million. The company paid dividends worth $73 million in the quarter.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Rollins has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Rollins has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Rollins (ROL) Up 7.5% Since Last Earnings Report?
It has been about a month since the last earnings report for Rollins (ROL - Free Report) . Shares have added about 7.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Rollins due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Rollins Q2 Earnings Meet Estimates
Rollins, Inc. second-quarter 2024 earnings met the Zacks Consensus Estimate but revenues beat the same.
Adjusted earnings of 27 cents per share increased 17.4% year over year. Revenues of $891.9 million beat the consensus mark by a slight margin and improved 8.7% year over year. Organic revenues of $877.8 million increased 7.7% year over year. Rollins’ performance in the quarter was positively impacted by a healthy demand environment for its services.
Quarter Details
Residential revenues increased 6.3% year over year to $408.4 million and beat our estimate of $401.9 million. Commercial revenues increased 9.9% year over year to $287.8 million and surpassed our estimate of $283.7 million. Termite and ancillary revenues increased 11.8% year over year to $186 million and missed our estimate of $187.7 million.
Adjusted EBITDA of $210 million increased 15.3% year over year. This compares to our expectation of an adjusted EBITDA of $206.4 million, up 14.6% year over year. Adjusted EBITDA margin of 23.6% increased 140 basis points (bps) year over year compared with our expectation of an adjusted EBITDA margin of 23.4%, up 110 bps year over year.
Rollins exited the quarter with a cash and cash equivalents balance of $106.7 million compared with the prior quarter’s $113 million. Long-term debt at the end of the quarter was $502 million compared with $510.9 million at the end of the prior quarter.
The company generated $145.1 million of cash from operating activities in the quarter and capital expenditure was $8.7 million. Free cash flow came in at $136.4 million. The company paid dividends worth $73 million in the quarter.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Rollins has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Rollins has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.