Shares of Rollins ROL have dipped 18.5% in a year compared with the industry’s 19.7% plunge.
ROL’s revenues in 2026 and 2027 are expected to increase 10.1% and 9.3% year over year, respectively. Earnings are anticipated to rise 10.7% in 2026 and 12.1% in 2027.
Factors That Augur Well for ROL’s Success
Buyouts Fueling Growth: Rollins disciplined and strategic M&A approach has allowed it to strengthen market share, enter new regions and diversify its service offerings. With an impressive 26 buyouts completed in 2025, following 44 in 2024 and 24 in 2023, Rollins has consistently demonstrated its ability to identify and integrate valuable targets. These acquisitions not only drive revenue growth but also create synergies, operational efficiencies and new customer relationships that enhance long-term shareholder value.
Tech Boosts Operations : ROL uses technology strategically to boost operational efficiency, improve customer experience and drive cost savings — all of which support sustainable growth. Through targeted investments in digital tools like BOSS, VRM, Orkin 2.0, BizSuite and InSite, Rollins has transformed how it manages its field operations, customer interactions and sales processes. In a traditionally labor-intensive industry, Rollins stands out as a tech-forward player, appealing to investors seeking stable returns with long-term growth potential.
Dividends Attract Investors: The company paid out dividends of $264.3 million, $298 million and $327.9 million in 2023, 2024 and 2025, respectively. A continued dividend underscores the company's commitment to its shareholders and underlines its business confidence. It is highly motivating for income-seeking investors.
Risks Faced by Rollins
Spending Affecting Margins: Rollins’ spending on customer acquisition, salesforce expansion and marketing initiatives over the past few years has increased to drive top-line growth and bolster its competitive positioning. However, it has affected profitability, as evidenced by a dip in the adjusted operating income margin to 16.9%, reflecting a 100-basis-point year-over-year decline during the first quarter of 2026.
High Interest Expenses: As of the end of 2025, ROL’s goodwill accounted for $1.4 billion, representing approximately 44% of the total assets. Since goodwill is an intangible asset, it cannot be leveraged to meet short-term obligations or reduce long-term debt. To finance many of these buyouts, Rollins has taken on substantial debt, which has increased interest expenses, putting pressure on profitability.
ROL’s Zacks Rank & Stocks to Consider
The company has a Zacks Rank #3 (Hold) at present.
Some better-ranked stocks from the broader Zacks Construction sector are AAON AAON and Quanta Services PWR, each currently flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AAON has a long-term earnings growth expectation of 16%. AAON delivered a trailing four-quarter earnings surprise of 6.2%, on average.
Quanta Services has a long-term earnings growth expectation of 19.8%. PWR delivered a trailing four-quarter earnings surprise of 10.3%, on average.
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This article originally published on Zacks Investment Research (zacks.com).