ROL US S&P 500Russell 1000 Earnings call · transcribed from the recording

Rollins, Inc. (ROL) · Q3 2026 results and valuation

Share price: $38.47 · 2026-11-11

Rollins, Inc. is an international services company that provides pest and wildlife control, termite protection, and related ancillary services. The company serves residential and commercial customers in approximately 70 countries. Its operations include pest prevention, treatment of infestations, and moisture remediation. Source: 10-K annual report (2026-02-12)

Results Q3 2026 vs Q2 2026 · previous quarter · published 21 Oct 2026 and 23 Jul 2026

Net income up 9.7% on the previous quarter. Management sounded about as positive as a typical company call, in its script and in answers to analysts.

1 · Numbers

+9.7%

Net income vs Q2 2026

Outlook given

Net income 157.9M vs 143.9M

Revenue +1.0%

2 · How management spoke

Typical

Less upbeat than 60% of company calls

Answers to analysts: restrained, in line with the script.

Similar to last call.

3 · What stood out

Rollins, Inc. updated its 2026 guidance to expect organic growth of 4 to 6 percent and incremental marginal margins ranging from slightly positive to 10%.

Valuation

Is Rollins, Inc. undervalued?

Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.

At 11.7% growth a year (3-year revenue growth), the model's fair value is $35.56 a share — the stock trades 8% above it. Today's price assumes 12.8% growth a year.

Current price

$38.47

close of 2026-11-11

Market implies growth of i

+12.8% for 10 yrs

Fair value / share

$35.56

Buy below

$26.67

Price vs fair value

Overvalued 8%

Price vs buy-below price

Overvalued 44%

FCF growth / yr i Discount rate i Terminal growth i Margin of safety i

Official channels

The company's own website and social media accounts.

Read between the lines

Key theme

Total revenue increased 6.2% with organic growth of 4.4%, which was below expectations for the quarter.

Source quote
“Total revenue increased 6.2%, including organic growth of 4.4%, which was below our expectations for the quarter.”
Key theme

Fuel costs were approximately 1.9% of sales in the third quarter, and the company expects these costs to remain below 2% of sales for 2026.

Source quote
“Fuel costs represented approximately 1.9% of sales in the third quarter, and we continue to expect fuel costs to remain below 2% of sales for 2026.”
Guidance

The company updated its 2026 guidance to expect organic growth of 4 to 6 percent and incremental marginal margins ranging from slightly positive to 10%.
Guidance

The company expects to be positive on price cost for the year because customer response to the recent price increase has been favorable.
Key theme

The company increased share repurchase activity this quarter due to financial flexibility and conviction in its intrinsic value while maintaining a healthy balance sheet.

Source quote
“Our financial flexibility and conviction in the intrinsic value of our business supported more meaningful share repurchase activity in the quarter, and we will continue to evaluate future share repurchases given the health of our balance sheet.”

4 more

Figure

The company believes the business has potential to achieve incremental margins in the 30% to 35% range over time due to operational opportunities in its longer-term margin framework.

Source quote
“In addition, we are confident in the operational opportunities that underpin our longer-term margin framework, and we believe the business has potential to achieve incremental margins in the 30% to 35% range over time.”
Figure

The company expects to reach the 5% midpoint of its projected range in the fourth quarter if current third-quarter trends continue.

Source quote
“So our assumptions now, what's underlying that range, is that if things continue in the fourth quarter just as they did in the third quarter, we will be in the 5%, the midpoint of that range.”
Key theme

Despite a more discerning consumer base, customers remain willing to spend money on pest control services.

Source quote
“I just think at this point in time, we have a more discerning consumer, but we certainly have a consumer that is willing to spend the money on pest control services.”
Key theme

AI and LLM driven search are meaningfully changing the way customers discover service providers.

Tone

How upbeat the language was, compared with other companiesi. Dot: Q3 2026. Ring: Q2 2026.

Prepared remarks Typical (was cautious)

Answers to analysts Restrained (was restrained)

Script and answers carried a similar tone, so the script's message held up under questioning.

Sentences that drove the tone

“That being said, Organ's commercial business continued to grow high single digits, reflecting the investments we have made there and expanding our commercial capabilities.”

“We are focused not only on restoring stronger organic growth, but also on ensuring that our operating expenses reflect current business volumes, allowing us to protect profitability while preserving the...”

“We believe the actions we are taking, together with the growth and productivity initiatives outlined at our May Investor Day, position us to deliver profitable growth and attractive shareholder returns...”

Full figures

USD · SEC EDGAR XBRL (10-Q, period end 2026-09-30)

Metric	Q3 2026period end 2026-09-30	Q2 2026period end 2026-06-30	Change	Q3 2025	YoY
Revenue	1.09B	1.08B	+1.0%	1.03B	+6.2%
Operating income	222.9M	201.4M	+10.7%	225.0M	−1.0%
Net income	157.9M	143.9M	+9.7%	163.5M	−3.4%
EPS	0.33	0.30	+10.0%	0.34	−2.9%
P/E today 34.8	27.6	37.9	−10.3	54.9	−27.3

Topics

Most discussed now

To the earnings release that Rollins issued yesterday, the company has also prepared a supporting slide presentation.
Brands that utilize relationship driven customer acquisition channels, including direct sales, door to door marketing, and home builder…
Moderating organic growth trends have not been broad based across Rollins' portfolio.
With additional data through the third quarter, Rollins clearly see the impact of the changing search landscape, which drove continued...
The result is a more fragmented, variable, and dynamic customer discovery environment.

Faded since Q2 2026

Fading Rollins has got a pretty difficult number to hurdle as it goes into Q3 of this year.
Fading Rollins justs entered into a great new agreement with its fleet supplier Wheels, that will help us continue to manage...
Fading It's just like some of that kind of call volume and for what Rollins would call occasional [indiscernible] and onetime...
Fading It wasn't steep in total, but it's still also an Orkin brand, a pretty sizable piece of their business.

Latest announcements

Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.

2026-10-21 Results of operations · SEC 8-K
Rollins, Inc. reported third-quarter revenues of $1.1 billion, up 6.2% from the prior year, while operating income of $223 million decreased by 1.0% compared to the third quarter of 2025.
2026-07-22 Results of operations · SEC 8-K
Rollins, Inc. reported second-quarter revenues of $1.1 billion, an increase of 7.9% over the second quarter of 2025, with net income of $144 million, up 1.7% year over year.
2026-05-27 Director or officer change · SEC 8-K
Rollins, Inc. announced that William W. Harkins will succeed Kenneth D. Krause as Executive Vice President and Chief Financial Officer, effective June 15, 2026.
2026-05-01 Shareholder vote results · SEC 8-K · routine
2026-04-22 Results of operations · SEC 8-K
Rollins, Inc. reported first-quarter revenues of $906 million, an increase of 10.2% compared to the first quarter of 2025, with net income of $108 million, up 2.5% year over year.
2026-02-11 Results of operations · SEC 8-K
Rollins, Inc. reported 2025 full-year revenues of $3.8 billion, an increase of 11.0% over the prior year, and a net income of $527 million, up 12.9% year over year.
2025-11-12 Other events · SEC 8-K
Rollins, Inc. closed a secondary public offering of 17,391,305 shares at $57.50 per share and repurchased 3,478,260 shares for approximately $200 million.
2025-11-12 Regulation FD disclosure · SEC 8-K
Rollins, Inc. priced a secondary public offering of 17,391,305 shares of common stock at $57.50 per share, with the company agreeing to repurchase 3,478,260 shares for approximately $200 million.

Catalyst calendar

management-stated targets — from the latest earnings call; plans, not promises.

2026

fuel costs to remain below 2% of sales

Source quote
“Fuel costs represented approximately 1.9% of sales in the third quarter, and we continue to expect fuel costs to remain below 2% of sales for 2026.”
for the year

full-year ETR to come in under 25%

Source quote
“Despite the slight increase in the quarter, we continue to expect our full-year ETR to come in under 25% for the year, down approximately 100 basis points from historical levels.”
for the year

organic growth of 4 to 6 percent

Source quote
“We now expect organic growth of 4 to 6 percent for the year, and corresponding incremental marginal margins ranging from slightly positive to 10% for 2026.”
three months from now

arrival at a point of stability/solution

Source quote
“This is going to be to say somehow that three months from now we think we've arrived.”
six months from now

resolution of problems and return to normal

Source quote
“So some idea that we've somehow solved this problem six months from now and everything's back to normal, I don't want to give anybody the impression that that's exactly how this will shape out.”