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Investing.com - Jefferies has raised its price target on Rollins (NYSE:ROL) stock to $66.00 from $65.00 while maintaining a Buy rating following the company’s third-quarter performance. The pest control giant currently trades at a P/E ratio of 54.1, reflecting investors’ premium valuation of the company’s consistent performance.
The pest control company’s Q3 results beat consensus estimates with EBITDA running 3% ahead of expectations and margins 80 basis points higher than analysts had modeled, though revenue was in-line with forecasts. InvestingPro data shows Rollins maintains impressive gross profit margins of 52.86%, supporting its ability to exceed margin expectations.
Rollins maintained healthy organic growth during the quarter, aligning with its 7-8% target for 2025, demonstrating consistent performance across its business segments.
The company achieved mid-single-digit to low-double-digit percentage organic growth across all business lines, coupled with margin expansion primarily driven by operating leverage on sales investments.
Jefferies characterized the quarter as strong, citing the combination of solid organic growth performance and the company’s ability to expand margins beyond expectations.
In other recent news, Rollins is preparing for its third-quarter earnings report with a balanced outlook, as noted by UBS. The firm maintained a Neutral rating and a $61.00 price target on the company’s stock. UBS adjusted its Q3 organic growth estimate slightly down to 7.5% from 7.8%, considering potential weather impacts in the East and Midwest regions, but still kept its estimates above the consensus. Meanwhile, JPMorgan initiated coverage on Rollins with an Overweight rating and a $70 price target, suggesting a potential 24% upside. The bank emphasized the company’s resilient business model, which benefits from recurring service contracts that account for about 80% of its revenue. These developments provide investors with insights into the company’s projected performance and market position.
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