2024-03-28 23:47:56 ET
Summary
- Rollins is one of the largest providers of pest and wildlife control services, primarily in the United States.
- The company is benefiting from long-term industry tailwinds such as rising global temperatures, climate change, government regulations, and long-term global shifts from rural to urban areas.
- Despite an optimistic outlook, the Rollins family has been selling shares, and multiples in the pest control industry have been bid up by private equity.
- With higher multiples in the space, Rollins' M&A strategy is at risk as the company looks like it has started to overpay for acquisitions.
- In my view, the valuation is unsupported by the company's growth rate, particularly when its closest competitor trades at half the company's valuation.
Introduction
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For further details see:
Rollins: The Price Has Gotten Ahead Of Itself