Is It Too Late To Consider Rollins After Strong 2025 Share Price Rally?

• If you are wondering whether Rollins is still worth buying after its big run up, or if most of the upside is now priced in, you are not alone. This is exactly what we are going to unpack.
• The stock has climbed 1.9% over the last week, 1.4% over the past month, and is now up about 32.8% year to date and 33.0% over the last year, with longer term gains of 71.3% over 3 years and 67.7% over 5 years from a recent close of $61.14.
• Those returns come against a backdrop of steady demand for pest control services and ongoing consolidation in the industry, which has helped support optimism around Rollins’ future growth. At the same time, investors are weighing how much of that steady story is already embedded in today’s price given broader market volatility and shifting rate expectations.
• Despite the strong share price performance, Rollins currently scores just 0 out of 6 on our valuation checks, suggesting it screens as expensive on traditional metrics. In the next sections we will break down those valuation approaches and then finish with a more holistic way of thinking about what the stock might really be worth.

Rollins scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Rollins Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a company is worth by projecting the cash it can generate in the future and then discounting those cash flows back to today in dollar terms. For Rollins, the model uses a 2 Stage Free Cash Flow to Equity approach.

Rollins generated trailing twelve month free cash flow of about $668 million, and analysts expect this to rise steadily, with projections reaching around $961 million by 2029. Beyond the explicit analyst forecast period, Simply Wall St extrapolates cash flows further out, assuming moderating growth as the business matures.

When all of these projected cash flows are discounted back to today, the model arrives at an estimated intrinsic value of roughly $47.72 per share, compared with the recent market price of about $61.14. That implies the stock is around 28.1% above the level suggested by this DCF analysis, pointing to a valuation that already reflects a high degree of optimism.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Rollins may be overvalued by 28.1%. Discover 900 undervalued stocks or create your own screener to find better value opportunities.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Rollins.

Approach 2: Rollins Price vs Earnings

For profitable companies like Rollins, the price to earnings, or PE, ratio is a useful way to gauge how much investors are willing to pay today for each dollar of current earnings. A higher PE can be justified when a business has strong, durable growth prospects and relatively low risk, while slower growing or more volatile companies typically deserve a lower, more conservative multiple.

Rollins currently trades on a PE of about 57.0x, well above both the Commercial Services industry average of roughly 23.9x and the peer group average of around 41.2x. To move beyond simple comparisons, Simply Wall St also calculates a Fair Ratio, which is the PE multiple the company might reasonably command given its earnings growth outlook, profitability, industry, size, and risk profile. For Rollins, that Fair Ratio is estimated at about 29.3x.

Because this Fair Ratio incorporates more company specific fundamentals than a basic industry or peer comparison, it is a more tailored benchmark for valuation. In comparison with the current PE of 57.0x, the Fair Ratio suggests Rollins is pricing in a very rich premium that is hard to justify solely on its fundamentals.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1458 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Rollins Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, a simple framework that lets you attach a clear story to your numbers by setting your own assumptions for Rollins’ future revenue, earnings, margins, and fair value, then seeing how that stacks up against today’s price.

A Narrative links three things together: what you believe about the business, how that belief translates into a financial forecast, and what fair value those forecasts imply so that your investment view becomes a coherent story rather than a loose collection of metrics.

On Simply Wall St’s Community page, used by millions of investors, Narratives are an easy, accessible tool that can help you organize your thinking by continuously comparing each Narrative’s evolving fair value to Rollins’ live share price, and automatically updating when new information like earnings releases or major news comes in.

For example, one investor might build a bullish Rollins Narrative that assumes recurring revenue strength and margin gains, and sees fair value closer to the high end of recent targets around $72.00. Another could construct a more cautious Narrative that incorporates cost pressures and slower growth, pointing to a fair value nearer the low end around $44.00.

Do you think there's more to the story for Rollins? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com