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Rentokil Initial

LSE:RTO
Snowflake Description

Moderate growth potential with imperfect balance sheet.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
RTO
LSE
£8B
Market Cap
  1. Home
  2. GB
  3. Commercial Services
Company description

Rentokil Initial plc, through its subsidiaries, provides route-based services in North America, the United Kingdom, rest of Europe, Asia, the Pacific, and internationally. The last earnings update was 127 days ago. More info.


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RTO Share Price and Events
7 Day Returns
-2%
LSE:RTO
-2.8%
GB Commercial Services
-2.5%
GB Market
1 Year Returns
38.8%
LSE:RTO
19.8%
GB Commercial Services
5.3%
GB Market
RTO Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Rentokil Initial (RTO) -2% 0% -5.8% 38.8% 110.4% 280.6%
GB Commercial Services -2.8% 0.1% 4.1% 19.8% 15.5% 12.6%
GB Market -2.5% -1.3% 0.9% 5.3% 4.1% 5.1%
1 Year Return vs Industry and Market
  • RTO outperformed the Commercial Services industry which returned 19.8% over the past year.
  • RTO outperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned 5.3% over the past year.
Price Volatility
RTO
Industry
5yr Volatility vs Market

RTO Value

 Is Rentokil Initial undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Rentokil Initial to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Rentokil Initial.

LSE:RTO Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 13 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 5.7%
Perpetual Growth Rate 10-Year GB Government Bond Rate 0.5%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for LSE:RTO
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year GB Govt Bond Rate 0.5%
Equity Risk Premium S&P Global 6.1%
Commercial Services Unlevered Beta Simply Wall St/ S&P Global 0.66
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.66 (1 + (1- 19%) (23.37%))
0.856
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
0.86
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 0.53% + (0.856 * 6.07%)
5.73%

Discounted Cash Flow Calculation for LSE:RTO using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Rentokil Initial is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

Note: Free cash flow to equity valuations ignore the company's cash or debt.

LSE:RTO DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (GBP, Millions) Source Present Value
Discounted (@ 5.73%)
2020 295.18 Analyst x6 279.20
2021 299.88 Analyst x5 268.28
2022 303.41 Est @ 1.18% 256.73
2023 306.39 Est @ 0.98% 245.21
2024 308.98 Est @ 0.85% 233.90
2025 311.30 Est @ 0.75% 222.89
2026 313.44 Est @ 0.69% 212.27
2027 315.44 Est @ 0.64% 202.05
2028 317.35 Est @ 0.61% 192.27
2029 319.20 Est @ 0.58% 182.92
Present value of next 10 years cash flows £2,295.00
LSE:RTO DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= £319.20 × (1 + 0.53%) ÷ (5.73% – 0.53%)
£6,175.98
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= £6,175.98 ÷ (1 + 5.73%)10
£3,539.12
LSE:RTO Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= £2,295.00 + £3,539.12
£5,834.12
Equity Value per Share
(GBP)
= Total value / Shares Outstanding
= £5,834.12 / 1,841.13
£3.17
LSE:RTO Discount to Share Price
Calculation Result
Value per share (GBP) From above. £3.17
Current discount Discount to share price of £4.39
= -1 x (£4.39 - £3.17) / £3.17
-38.4%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

  • The current share price of Rentokil Initial is above its future cash flow value.
Often investors are willing to pay a premium for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Rentokil Initial's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Rentokil Initial's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
LSE:RTO PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-06-30) in GBP £-0.05
LSE:RTO Share Price ** LSE (2019-12-05) in GBP £4.39
United Kingdom of Great Britain and Northern Ireland Commercial Services Industry PE Ratio Median Figure of 25 Publicly-Listed Commercial Services Companies 18.75x
United Kingdom of Great Britain and Northern Ireland Market PE Ratio Median Figure of 752 Publicly-Listed Companies 17.14x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Rentokil Initial.

LSE:RTO PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= LSE:RTO Share Price ÷ EPS (both in GBP)

= 4.39 ÷ -0.05

-83.76x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Rentokil Initial is loss making, we can't compare its value to the GB Commercial Services industry average.
  • Rentokil Initial is loss making, we can't compare the value of its earnings to the United Kingdom of Great Britain and Northern Ireland market.
Price based on expected Growth
Does Rentokil Initial's expected growth come at a high price?
Raw Data
LSE:RTO PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section -83.76x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 13 Analysts
10.8%per year
United Kingdom of Great Britain and Northern Ireland Commercial Services Industry PEG Ratio Median Figure of 20 Publicly-Listed Commercial Services Companies 1.27x
United Kingdom of Great Britain and Northern Ireland Market PEG Ratio Median Figure of 562 Publicly-Listed Companies 1.44x

*Line of best fit is calculated by linear regression .

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Unable to calculate PEG ratio for Rentokil Initial, we can't assess if its growth is good value.
Price based on value of assets
What value do investors place on Rentokil Initial's assets?
Raw Data
LSE:RTO PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-06-30) in GBP £0.46
LSE:RTO Share Price * LSE (2019-12-05) in GBP £4.39
United Kingdom of Great Britain and Northern Ireland Commercial Services Industry PB Ratio Median Figure of 32 Publicly-Listed Commercial Services Companies 2.24x
United Kingdom of Great Britain and Northern Ireland Market PB Ratio Median Figure of 1,311 Publicly-Listed Companies 1.53x
LSE:RTO PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= LSE:RTO Share Price ÷ Book Value per Share (both in GBP)

= 4.39 ÷ 0.46

9.44x

* Primary Listing of Rentokil Initial.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Rentokil Initial is overvalued based on assets compared to the GB Commercial Services industry average.
X
Value checks
We assess Rentokil Initial's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Commercial Services industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Commercial Services industry average (and greater than 0)? (1 check)
  5. Rentokil Initial has a total score of 0/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

RTO Future Performance

 How is Rentokil Initial expected to perform in the next 1 to 3 years based on estimates from 13 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
10.8%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Rentokil Initial expected to grow at an attractive rate?
  • Rentokil Initial's earnings growth is expected to exceed the low risk savings rate of 0.5%.
Growth vs Market Checks
  • Rentokil Initial's earnings growth is positive but not above the United Kingdom of Great Britain and Northern Ireland market average.
  • Rentokil Initial's revenue growth is expected to exceed the United Kingdom of Great Britain and Northern Ireland market average.
Annual Growth Rates Comparison
Raw Data
LSE:RTO Future Growth Rates Data Sources
Data Point Source Value (per year)
LSE:RTO Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 13 Analysts 10.8%
LSE:RTO Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 13 Analysts 5.1%
United Kingdom of Great Britain and Northern Ireland Commercial Services Industry Earnings Growth Rate Market Cap Weighted Average 15.1%
United Kingdom of Great Britain and Northern Ireland Commercial Services Industry Revenue Growth Rate Market Cap Weighted Average 4.9%
United Kingdom of Great Britain and Northern Ireland Market Earnings Growth Rate Market Cap Weighted Average 12.4%
United Kingdom of Great Britain and Northern Ireland Market Revenue Growth Rate Market Cap Weighted Average 3.6%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
LSE:RTO Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (5 months ago) See Below
Future Estimates Average of up to 13 Analyst Estimates (S&P Global) See Below
All numbers in GBP Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
LSE:RTO Future Estimates Data
Date (Data in GBP Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2023-12-31 3,290 1
2022-12-31 3,148 1
2021-12-31 3,028 586 259 12
2020-12-31 2,896 552 239 13
2019-12-31 2,722 485 305 13
2019-12-05
LSE:RTO Past Financials Data
Date (Data in GBP Millions) Revenue Cash Flow Net Income *
2019-06-30 2,595 398 -97
2019-03-31 2,534 381 -97
2018-12-31 2,472 364 -98
2018-09-30 2,414 355 46
2018-06-30 2,355 347 190
2018-03-31 2,384 364 436
2017-12-31 2,412 380 683
2017-09-30 2,413 386 683
2017-06-30 2,415 392 682
2017-03-31 2,291 377 425
2016-12-31 2,168 361 168
2016-09-30 2,029 350 151

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Rentokil Initial's earnings are expected to grow by 10.8% yearly, however this is not considered high growth (20% yearly).
  • Rentokil Initial's revenue is expected to grow by 5.1% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
LSE:RTO Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (5 months ago) See Below
Future Estimates Average of up to 13 Analyst Estimates (S&P Global) See Below

All data from Rentokil Initial Company Filings, last reported 5 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

LSE:RTO Future Estimates Data
Date (Data in GBP Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2023-12-31
2022-12-31
2021-12-31 0.14 0.17 0.13 5.00
2020-12-31 0.13 0.15 0.12 7.00
2019-12-31 0.17 0.19 0.10 6.00
2019-12-05
LSE:RTO Past Financials Data
Date (Data in GBP Millions) EPS *
2019-06-30 -0.05
2019-03-31 -0.05
2018-12-31 -0.05
2018-09-30 0.02
2018-06-30 0.10
2018-03-31 0.24
2017-12-31 0.37
2017-09-30 0.37
2017-06-30 0.37
2017-03-31 0.23
2016-12-31 0.09
2016-09-30 0.08

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Rentokil Initial is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).
X
Future performance checks
We assess Rentokil Initial's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United Kingdom of Great Britain and Northern Ireland market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United Kingdom of Great Britain and Northern Ireland market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Rentokil Initial has a total score of 3/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

RTO Past Performance

  How has Rentokil Initial performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Rentokil Initial's growth in the last year to its industry (Commercial Services).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Rentokil Initial does not make a profit even though their year on year earnings growth rate was positive over the past 5 years.
  • Unable to compare Rentokil Initial's 1-year earnings growth to the 5-year average as it is not currently profitable.
  • Unable to compare Rentokil Initial's 1-year growth to the GB Commercial Services industry average as it is not currently profitable.
Earnings and Revenue History
Rentokil Initial's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Rentokil Initial Company Filings, last reported 5 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

LSE:RTO Past Revenue, Cash Flow and Net Income Data
Date (Data in GBP Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-06-30 2,595.10 -96.60 1,368.10
2019-03-31 2,533.70 -97.45 1,366.05
2018-12-31 2,472.30 -98.30 1,364.00
2018-09-30 2,413.55 45.70 1,346.50
2018-06-30 2,354.80 189.70 1,329.00
2018-03-31 2,383.55 436.35 1,329.30
2017-12-31 2,412.30 683.00 1,329.60
2017-09-30 2,413.45 682.65 1,264.05
2017-06-30 2,414.60 682.30 1,198.50
2017-03-31 2,291.35 425.05 1,198.05
2016-12-31 2,168.10 167.80 1,197.60
2016-09-30 2,029.45 150.70 1,081.00
2016-06-30 1,890.80 133.60 964.40
2016-03-31 1,824.90 128.95 965.05
2015-12-31 1,759.00 124.30 965.70
2015-09-30 1,750.35 127.15 949.85
2015-06-30 1,741.70 130.00 934.00
2015-03-31 1,741.25 128.05 934.85
2014-12-31 1,740.80 126.10 935.70
2014-09-30 1,746.15 111.95 893.45 0.90
2014-06-30 1,751.50 97.80 851.20 1.80
2014-03-31 1,771.45 89.95 850.40 1.80
2013-12-31 1,791.40 82.10 849.60 1.80
2013-09-30 1,902.30 70.65 959.20 1.80
2013-06-30 2,013.20 59.20 1,068.80 1.80
2013-03-31 2,119.95 65.25 1,068.90 1.80
2012-12-31 2,226.70 71.30 1,069.00 1.80

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • It is difficult to establish if Rentokil Initial has efficiently used shareholders’ funds last year (Return on Equity greater than 20%) as it is loss-making.
  • It is difficult to establish if Rentokil Initial has efficiently used its assets last year compared to the GB Commercial Services industry average (Return on Assets) as it is loss-making.
  • It is difficult to establish if Rentokil Initial improved its use of capital last year versus 3 years ago (Return on Capital Employed) as it is currently loss-making.
X
Past performance checks
We assess Rentokil Initial's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Commercial Services industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Rentokil Initial has a total score of 0/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

RTO Health

 How is Rentokil Initial's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Rentokil Initial's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Rentokil Initial's short term (1 year) commitments are greater than its holdings of cash and other short term assets.
  • Rentokil Initial's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of Rentokil Initial's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • Low level of unsold assets.
  • Debt is not covered by short term assets, assets are 0.7x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Rentokil Initial Company Filings, last reported 5 months ago.

LSE:RTO Past Debt and Equity Data
Date (Data in GBP Millions) Total Equity Total Debt Cash & Short Term Investments
2019-06-30 858.70 1,654.80 452.40
2019-03-31 858.70 1,654.80 452.40
2018-12-31 832.60 1,223.90 132.30
2018-09-30 832.60 1,223.90 132.30
2018-06-30 1,030.60 1,213.80 162.80
2018-03-31 1,030.60 1,213.80 162.80
2017-12-31 934.00 1,197.50 310.60
2017-09-30 934.00 1,197.50 310.60
2017-06-30 834.20 1,479.70 502.70
2017-03-31 834.20 1,479.70 502.70
2016-12-31 360.70 1,297.00 171.10
2016-09-30 360.70 1,297.00 171.10
2016-06-30 317.50 1,223.90 128.30
2016-03-31 317.50 1,223.90 128.30
2015-12-31 212.10 1,211.60 201.90
2015-09-30 212.10 1,211.60 201.90
2015-06-30 141.60 959.10 267.60
2015-03-31 141.60 959.10 267.60
2014-12-31 100.00 1,007.20 239.40
2014-09-30 100.00 1,007.20 239.40
2014-06-30 -46.00 1,009.90 167.90
2014-03-31 -46.00 1,009.90 167.90
2013-12-31 -232.00 1,446.10 435.80
2013-09-30 -232.00 1,446.10 435.80
2013-06-30 -186.40 1,224.60 125.00
2013-03-31 -186.40 1,224.60 125.00
2012-12-31 -127.20 1,232.70 169.10
  • Rentokil Initial's level of debt (192.7%) compared to net worth is high (greater than 40%).
  • Rentokil Initial had negative shareholder equity 5 years ago, it is now positive therefore their debt level has improved.
  • Debt is well covered by operating cash flow (24%, greater than 20% of total debt).
  • Rentokil Initial is making a loss, therefore interest payments are not well covered by earnings.
X
Financial health checks
We assess Rentokil Initial's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Rentokil Initial has a total score of 2/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

RTO Dividends

 What is Rentokil Initial's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
1.02%
Current annual income from Rentokil Initial dividends. Estimated to be 1.31% next year.
If you bought £2,000 of Rentokil Initial shares you are expected to receive £20 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Rentokil Initial's pays a lower dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (1.97%).
  • Rentokil Initial's dividend is below the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.29%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
LSE:RTO Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 13 Analyst Estimates (S&P Global) See Below
United Kingdom of Great Britain and Northern Ireland Commercial Services Industry Average Dividend Yield Market Cap Weighted Average of 21 Stocks 2.8%
United Kingdom of Great Britain and Northern Ireland Market Average Dividend Yield Market Cap Weighted Average of 679 Stocks 4.5%
United Kingdom of Great Britain and Northern Ireland Minimum Threshold Dividend Yield 10th Percentile 1.1%
United Kingdom of Great Britain and Northern Ireland Bottom 25% Dividend Yield 25th Percentile 2%
United Kingdom of Great Britain and Northern Ireland Top 25% Dividend Yield 75th Percentile 5.3%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

LSE:RTO Future Dividends Estimate Data
Date (Data in £) Dividend per Share (annual) Avg. No. Analysts
2023-12-31
2022-12-31
2021-12-31 0.07 13.00
2020-12-31 0.06 14.00
2019-12-31 0.05 14.00
2019-12-05
LSE:RTO Past Annualized Dividends Data
Date (Data in £) Dividend per share (annual) Avg. Yield (%)
2019-03-27 0.045 1.075
2019-02-28 0.045 1.279
2018-04-05 0.039 1.189
2018-03-01 0.039 1.441
2017-07-31 0.035 1.155
2017-04-05 0.034 1.270
2017-02-23 0.034 1.386
2016-04-08 0.029 1.412
2016-02-25 0.029 1.729
2015-04-10 0.026 1.725
2015-02-27 0.026 1.878
2014-04-11 0.023 1.932
2014-02-28 0.023 1.839
2013-03-15 0.021 2.030
2012-03-02 0.020 2.394
2012-03-01 0.020 2.559
2010-04-15 0.000 0.000
2010-02-19 0.000 0.000
2009-11-06 0.000 0.000
2009-07-31 0.000 0.000
2009-05-01 0.000 0.000
2009-02-20 0.000 0.000

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Rentokil Initial is not paying a notable dividend for United Kingdom of Great Britain and Northern Ireland, therefore no need to check if the payments are stable.
  • Rentokil Initial is not paying a notable dividend for United Kingdom of Great Britain and Northern Ireland, therefore no need to check if the payments are increasing.
Current Payout to shareholders
What portion of Rentokil Initial's earnings are paid to the shareholders as a dividend.
  • No need to calculate the sustainability of Rentokil Initial's dividends as it is not paying a notable one for United Kingdom of Great Britain and Northern Ireland.
Future Payout to shareholders
  • Dividends after 3 years are expected to be well covered by earnings (2.7x coverage).
X
Income/ dividend checks
We assess Rentokil Initial's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.1%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Rentokil Initial afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Rentokil Initial has a total score of 1/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

RTO Management

 What is the CEO of Rentokil Initial's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Andy Ransom
COMPENSATION £4,406,700
AGE 56
TENURE AS CEO 6.2 years
CEO Bio

Mr. Andrew M. Ransom, also known as Andy, has been the Chief Executive Officer of Rentokil Initial plc since October 1, 2013. Mr. Andy serves as Non-Executive Director and Senior Independent Director of Selecta AG since February 01, 2019. Mr. Ransom is Director of Street League. He served as the Executive Director of Corporate Development for Rentokil Initial plc since May 1, 2008. He joined Rentokil Initial plc in 2008 as the Executive Director of the global Pest Control business and was also responsible for its Legal and M&A functions. Mr. Ransom joined Ambius from Imperial Chemical Industries PLC. He served as Executive Vice President of Mergers & Acquisitions, General Counsel and Company Secretary of Imperial Chemical Industries PLC (ICI Plc) since June 30, 2005. During his twenty years at ICI, he was responsible for a number of Group functions (including M&A and Legal) and international businesses (including ICI's Regional and Industrial Division) and worked for a number of years in both Canada and the USA. Mr. Ransom served a Member of Executive Management Team at Imperial Chemical Industries PLC since July 1, 2005. Mr. Ransom served as an Executive Vice President of Imperial Chemical Industries PLC. Mr. Ransom worked as General Counsel for ICI in the Americas as well as in a senior legal role for the Group, based in London. He was with ICI for eighteen years. He joined Group Legal Department at ICI's Head Office in 1987, where he specialised as Senior Mergers and Acquisitions Lawyer. Mr. Ransom was seconded to ICI Explosives in Toronto, Canada in 1996 and became Vice President and General Counsel for ICI in the Americas three years later. A seasoned negotiator and transaction lawyer, he led the legal effort on many ICI deals including the sale of ICI's explosives business to Orica in 1998 and the transaction with Huntsman in 1999. He serves as the Chairman of the Board of Ambius, Inc. and has Executive responsibility for Ambius globally and since January 1, 2009 for both the Asia and Pacific Regions. He is also has functional responsibility for Corporate Development, M&A, Legal, Company Secretariat, Risk and Health and Safety. He has been an Executive Director of Rentokil Initial plc since May 1, 2008. Mr. Ransom served as a Director of Zeneca, Inc. He served as Director of Akzo Nobel India Limited (also known as ICI India Ltd) from April 1, 2007 to April 28, 2008. He serves as Director and Trustee of Street League. He is the Patron of Malaria No More UK. He served as a Director of Lotte Pakistan PTA Limited (also known as Pakistan PTA Ltd) from October 24, 2007 to April 30, 2008. Mr. Ransom is a graduate of the University of Southampton and qualified as a Solicitor in 1987.

CEO Compensation
  • Andy's compensation has increased whilst company is loss making.
  • Andy's remuneration is about average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.
Management Team Tenure

Average tenure and age of the Rentokil Initial management team in years:

6.2
Average Tenure
54
Average Age
  • The average tenure for the Rentokil Initial management team is over 5 years, this suggests they are a seasoned and experienced team.
Management Team

Andy Ransom

TITLE
CEO & Executive Director
COMPENSATION
£4M
AGE
56
TENURE
6.2 yrs

Jeremy Townsend

TITLE
CFO & Executive Director
COMPENSATION
£3M
AGE
55
TENURE
9.3 yrs

Katharine Rycroft

TITLE
Head of Investor Relations

Daragh P. Fagan

TITLE
Group General Counsel & Company Secretary
AGE
49
TENURE
6.3 yrs

Malcolm Padley

TITLE
Director of Corporate Communications
TENURE
13.9 yrs

Gary Booker

TITLE
Chief Marketing
TENURE
1.9 yrs

Vanessa Evans

TITLE
Group Human Resources Director
AGE
50
TENURE
3.9 yrs

Stuart Ingall-Tombs

TITLE
Chief Financial Officer of Europe
TENURE
5.2 yrs

John Myers

TITLE
Managing Director of North America
AGE
61
TENURE
6.2 yrs

Phill Wood

TITLE
Managing Director of UK & Rest of World
AGE
53
TENURE
6.2 yrs
Board of Directors Tenure

Average tenure and age of the Rentokil Initial board of directors in years:

6.6
Average Tenure
56
Average Age
  • The tenure for the Rentokil Initial board of directors is about average.
Board of Directors

Richard Solomons

TITLE
Independent Chairman
AGE
58
TENURE
0.6 yrs

Andy Ransom

TITLE
CEO & Executive Director
COMPENSATION
£4M
AGE
56
TENURE
11.6 yrs

Jeremy Townsend

TITLE
CFO & Executive Director
COMPENSATION
£3M
AGE
55
TENURE
9.3 yrs

Ian Harley

TITLE
Chairman of Rentokil Initial Pension Trustee Limited
COMPENSATION
£30K
AGE
68
TENURE
12.4 yrs

Angela Seymour-Jackson

TITLE
Non-Executive Director
COMPENSATION
£60K
AGE
53
TENURE
7.8 yrs

Julie Southern

TITLE
Non-Executive Director
COMPENSATION
£75K
AGE
60
TENURE
5.4 yrs

John Pettigrew

TITLE
COMPENSATION
£60K
AGE
50
TENURE
0.6 yrs

Linda Yueh

TITLE
Non-Executive Director
COMPENSATION
£60K
TENURE
2.1 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month open market individual insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (£) Value (£)
X
Management checks
We assess Rentokil Initial's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Rentokil Initial has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

RTO News

Simply Wall St News

Is Rentokil Initial's (LON:RTO) Share Price Gain Of 254% Well Earned?

One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. … Over half a decade, Rentokil Initial managed to grow its earnings per share at 2.1% a year. … So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return.

Simply Wall St -

Only 3 Days Left To Cash In On Rentokil Initial plc (LON:RTO) Dividend

As a result, readers should always check whether Rentokil Initial has been able to grow its dividends, or if the dividend might be cut. … View our latest analysis for Rentokil Initial Dividends are typically paid from company earnings. … If Rentokil Initial didn't generate enough cash to pay the dividend, then it must have either paid from cash in the bank or by borrowing money, neither of which is sustainable in the long term.

Simply Wall St -

Do Institutions Own Rentokil Initial plc (LON:RTO) Shares?

View our latest analysis for Rentokil Initial LSE:RTO Ownership Summary, July 31st 2019 What Does The Institutional Ownership Tell Us About Rentokil Initial? … We can see that Rentokil Initial does have institutional investors; and they hold 87% of the stock. … Insider Ownership Of Rentokil Initial While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders.

Simply Wall St -

Should You Worry About Rentokil Initial plc's (LON:RTO) CEO Pay?

Check out our latest analysis for Rentokil Initial How Does Andy Ransom's Compensation Compare With Similar Sized Companies? … At the time of writing our data says that Rentokil Initial plc has a market cap of UK£7.5b, and is paying total annual CEO compensation of UK£4.4m. … Thus we can conclude that Andy Ransom receives more in total compensation than the median of a group of companies in the same market, and of similar size to Rentokil Initial plc.

Simply Wall St -

Rentokil Initial plc (LON:RTO) Is Yielding 1.2% - But Is It A Buy?

Dividend paying stocks like Rentokil Initial plc (LON:RTO) tend to be popular with investors, and for good reason - some research suggests a significant amount of all stock market returns come from reinvested dividends. Yet sometimes, investors buy a popular dividend stock because of its yield, and then lose money if the company's dividend doesn't live up to expectations. Investors might not know much about Rentokil Initial's dividend prospects, even though it has been paying dividends for the last seven years and offers a 1.2% yield. A 1.2% yield is not inspiring, but the longer payment history has some appeal. There are a few simple ways to reduce the risks of buying Rentokil Initial for its dividend, and we'll go through these below. Explore this interactive chart for our latest analysis on Rentokil Initial! LSE:RTO Historical Dividend Yield, June 13th 2019 Payout ratios Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. Although Rentokil Initial pays a dividend, it was loss-making during the past year. When a company recently reported a loss, we should investigate if its cash flows covered the dividend. Rentokil Initial's cash payout ratio in the last year was 38%, which suggests dividends were well covered by cash generated by the business. Is Rentokil Initial's Balance Sheet Risky? Given Rentokil Initial is paying a dividend but reported a loss over the past year, we need to check its balance sheet for signs of financial distress. A rough way to check this is with these two simple ratios: a) net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and b) net interest cover. … Strong earnings per share (EPS) growth might encourage our interest in the company despite fluctuating dividends, which is why it's great to see Rentokil Initial has grown its earnings per share at 23% per annum over the past five years. Conclusion Dividend investors should always want to know if a) a company's dividends are affordable, b) if there is a track record of consistent payments, and c) if the dividend is capable of growing. … Earnings growth generally bodes well for the future value of company dividend payments.

Simply Wall St -

Did Business Growth Power Rentokil Initial's (LON:RTO) Share Price Gain of 210%?

But on a lighter note, a good company can see its share price rise well over 100%. … One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. … Over half a decade, Rentokil Initial managed to grow its earnings per share at 23% a year.

Simply Wall St -

Should You Worry About Rentokil Initial plc's (LON:RTO) CEO Salary Level?

First, this article will compare CEO compensation with compensation at similar sized companies. … How Does Andy Ransom's Compensation Compare With Similar Sized Companies. … At the time of writing our data says that Rentokil Initial plc has a market cap of UK£6.1b, and is paying total annual CEO compensation of UK£4.4m.

Simply Wall St -

Should You Buy Rentokil Initial plc (LON:RTO) For Its Dividend?

Historically, Rentokil Initial plc (LON:RTO) has paid a dividend to shareholders. … Let's dig deeper into whether Rentokil Initial should have a place in your portfolio. … View our latest analysis for Rentokil Initial

Simply Wall St -

Rentokil Initial plc (LON:RTO) Delivered A Better ROE Than Its Industry

With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. … By way of learning-by-doing, we'll look at ROE to gain a better understanding of Rentokil Initial plc (LON:RTO). … Return on Equity = Net Profit ÷ Shareholders' Equity

Simply Wall St -

Are Insiders Buying Rentokil Initial plc (LON:RTO) Stock?

So we'll take a look at whether insiders have been buying or selling shares in Rentokil Initial plc (LON:RTO). … But logic dictates you should pay some attention to whether insiders are buying or selling shares. … Rentokil Initial Insider Transactions Over The Last Year.

Simply Wall St -

RTO Company Info

Description

Rentokil Initial plc, through its subsidiaries, provides route-based services in North America, the United Kingdom, rest of Europe, Asia, the Pacific, and internationally. It offers a range of pest control services from rodents to flying and crawling insects, as well as to other forms of wildlife management for commercial and residential customers. The company also provides hygiene services, including the provision and maintenance of products, such as air fresheners, sanitizers, feminine hygiene units, hand dryers, paper and linen towel dispensers, soap dispensers, toilet paper dispensers, and floor protection mats. In addition, it engages in the supply and laundering of workwear, uniforms, cleanroom uniforms, and protective equipment. Further, the company installs and services interior and exterior plant displays, flowers, replica foliage, Christmas decorations, and ambient scenting for commercial businesses; offers property care services consisting of damp proofing, property conservation, and woodworm and wood rot treatment; and provides a range of specialized deep cleaning, and specialist industrial cleaning and disinfection services, including the professional and discreet disinfection of areas that have been exposed to bio-hazardous situations, such as crime and trauma scenes, prison cells, void properties, emergency vehicles, and healthcare establishments. Additionally, it offers a range of healthcare waste management services comprising the collection, disposal, and recycling of hazardous and offensive waste produced by businesses and organizations associated with the provision of healthcare; and color-coded sharps disposal bins to deal with various types of waste. Rentokil Initial plc was founded in 1903 and is headquartered in Camberley, the United Kingdom.

Details
Name: Rentokil Initial plc
RTO
Exchange: LSE
Founded: 1903
£8,001,563,865
1,841,132,965
Website: http://www.rentokil-initial.com
Address: Rentokil Initial plc
Riverbank,
Meadows Business Park,
Camberley,
Surrey, GU17 9AB,
United Kingdom
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
LSE RTO Ordinary Shares London Stock Exchange GB GBP 11. May 1992
OTCPK RKLI.F Ordinary Shares Pink Sheets LLC US USD 11. May 1992
DB RTO1 Ordinary Shares Deutsche Boerse AG DE EUR 11. May 1992
BATS-CHIXE RTOL Ordinary Shares BATS 'Chi-X Europe' GB GBP 11. May 1992
OTCPK RTOK.Y SPONSORED ADR Pink Sheets LLC US USD 25. Sep 1995
Number of employees
Current staff
Staff numbers
39,500
Rentokil Initial employees.
Industry
Environmental and Facilities Services
Commercial Services
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/12/05 20:34
End of day share price update: 2019/12/05 00:00
Last estimates confirmation: 2019/11/27
Last earnings filing: 2019/07/31
Last earnings reported: 2019/06/30
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.