# Rentokil Initial (RTO.LSE)

Canonical: https://gigainvestors.com/s/RTO.LSE

Analysis as of: 2026-10-16T07:35:50.101Z. Financial observations: FY2016–FY2025.

Listing currency: GBX. Reporting currency: USD.

## Verdict

A wonderful business at a fair price

Quality tests for Buy: pass (profit record: pass; earnings resilience is evidence only). Published buy qualification: yes.

Share price: GBX 311.50 per share; close as of 2026-10-15.

Estimated value: low GBX 295.81 per share, central GBX 329.48 per share, high GBX 374.31 per share. Buy at or below the central value GBX 329.48 per share. Valuation as of 2026-10-16T07:35:50.101Z; scenarios are not confidence intervals.

Expected annual return: 10.5% at the stated quote. About 10.5% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; GB 10-year bond 5.4% + 4 points).

## Checklist

### understandable: pass

- 0 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 0

- Years with a net loss: 1

- Operating margin variation: 0.12×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.11×

- FY2017: 0.13×

- FY2018: 0.11×

- FY2019: 0.11×

- FY2020: 0.10×

- FY2021: 0.12×

- FY2022: 0.09×

- FY2023: 0.11×

- FY2024: 0.10×

- FY2025: 0.08×

### moat: pass

- ROIC, median of available years: 29.6%

- ROIC, second-lowest year: 16.9%

- Typical minus recent gross margin: -3.3 pp

- Typical gross margin (annual median): 79.8%

- Recent gross margin (lower of latest and 3-year median): 83.1%

- Years with nonpositive capital: 0

- Capital spending / revenue: 4.8%

- ROIC including acquisitions, ten-year median: 10.6%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 27.9%

- FY2017: 32.0%

- FY2018: 26.8%

- FY2019: 31.3%

- FY2020: 41.1%

- FY2021: 40.3%

- FY2022: 11.1%

- FY2023: 19.6%

- FY2024: 16.9%

- FY2025: 37.6%

### economics: pass

- Owner earnings / net income, 5-yr: 1.69×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $3.3B

- Net income, five-year total: $2.0B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: -1.5 pp

- Working capital / revenue, change between three-year averages: -12.1 pp

- Working capital / revenue, final three-year average: 0.1%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.94×

- FY2022: 2.28×

- FY2023: 1.45×

- FY2024: 1.67×

- FY2025: 1.39×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 27.9% vs 19.6%

- Per-share earnings: 0.12 to 0.19 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 5-year annual growth: 6.4%

- Market cap gain: $9.6B

- Cumulative retained earnings: $3.8B

- Diluted shares, 5-year annual growth: 6.4%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 6.1%

- Per-share value change: $0.06

- Per-share value, starting three-year median: $0.12

- Per-share value, ending three-year median: $0.19

- Buyback history: 0 years

- Debt-funded buybacks: No

- Acquisition spending: $8.3B

- Cumulative net income, 10 years: $3.6B

- ROIC, first three-year median: 27.9%

- ROIC, last three-year median: 19.6%

Chart: Earnings per share; fiscal year observations.

- FY2016: $0.12

- FY2017: $0.48

- FY2018: -$0.07

- FY2019: $0.20

- FY2020: $0.13

- FY2021: $0.19

- FY2022: $0.14

- FY2023: $0.19

- FY2024: $0.16

- FY2025: $0.19

### accounting: pass

- Sloan accruals: -4.7%

- Receivables to sales index (DSRI): 0.97×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 2.07×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 2.18×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -8.5%

- FY2017: 9.3%

- FY2018: -15.8%

- FY2019: -5.1%

- FY2020: -6.2%

- FY2021: -7.1%

- FY2022: -3.2%

- FY2023: -3.1%

- FY2024: -3.6%

- FY2025: -4.7%

## Holders

## Price story

Down 51% since May 2023 · sales +4.4%

Story as of 2026-10-16T10:00:06.165Z; price observation 2026-10-15.

Price needs cash profits to grow 0.1% a year for ten years

### Sales · FY2024–2025

sales +4.4%; source https://filings.xbrl.org/549300VN4WV7Z6T14K68/2025-12-31/ESEF/GB/0/549300VN4WV7Z6T14K68-2025-12-31/reports/549300VN4WV7Z6T14K68-2025-12-31-T01.html; observed 2026-04-07.

- FY2016: $2.9B 

- FY2017: $3.1B 

- FY2018: $3.3B 

- FY2019: $3.5B 

- FY2020: $3.6B 

- FY2021: $4.1B 

- FY2022: $4.6B 

- FY2023: $6.4B 

- FY2024: $6.6B 

- FY2025: $6.9B 

### Gross margin · FY2025

gross margin 83.1%; source https://filings.xbrl.org/549300VN4WV7Z6T14K68/2025-12-31/ESEF/GB/0/549300VN4WV7Z6T14K68-2025-12-31/reports/549300VN4WV7Z6T14K68-2025-12-31-T01.html; observed 2026-04-07.

- FY2016: 82.7% 

- FY2017: 80.4% 

- FY2018: 79.3% 

- FY2019: 79.2% 

- FY2020: 79.2% 

- FY2021: 24.2% 

- FY2022: 26.3% 

- FY2023: 83.0% 

- FY2024: 83.5% 

- FY2025: 83.1% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Annual sales are USD 6.9 billion.

- Source: https://filings.xbrl.org/549300VN4WV7Z6T14K68/2025-12-31/ESEF/GB/0/549300VN4WV7Z6T14K68-2025-12-31/reports/549300VN4WV7Z6T14K68-2025-12-31-T01.html (filed 2026-04-07); FY2025: revenue 6908000000; grossProfit 5742000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); RTO.LSE: Rentokil Initial plc, together with its subsidiaries, provides route-based services in North America, Europe, the United Kingdom, Asia, the Middle East, North Africa, Turkey, and Pacific. The company offers a range of pest control services for rodents, and flying and crawling insects, as well as other forms of wildlife management. It provides hygiene services, including the provision and maintenance of products, such as soap and hand sanitizer dispensers, hand dryers, air care and purification, cubicle and surface sanitizers, feminine hygiene units, toilet paper dispensers, and floor protection mats. In addition, the company engages in the supply and laundering of garments for commercial organizations. Further, the company provides a range of specialist cleaning services, such as graffiti removal, deep cleaning of kitchens and washrooms, trauma cleaning, and flood or fire damage cleaning, as well as specialist deep cleaning services. Rentokil Initial plc was founded in 1903 and is headquartered in Crawley, the United Kingdom.

### Why customers stay

Margins ranged from 83% to 83.5% during 2023–25; it earns 29.6% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2023: grossProfit / revenue = 83%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2024: grossProfit / revenue = 83.5%.

- Source: https://filings.xbrl.org/549300VN4WV7Z6T14K68/2025-12-31/ESEF/GB/0/549300VN4WV7Z6T14K68-2025-12-31/reports/549300VN4WV7Z6T14K68-2025-12-31-T01.html (filed 2026-04-07); FY2025: grossProfit / revenue = 83.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); 10-year return on capital observations [[2016,0.2789690794112767],[2017,0.3196935990207521],[2018,0.26812830490909717],[2019,0.3133850676963989],[2020,0.4112971968399263],[2021,0.4032522240650684],[2022,0.11149146142740202],[2023,0.19639805938077232],[2024,0.16875543397586787],[2025,0.37627491008426184]]; median 0.2961770735538378. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 7 of 10 years.

- Source: https://eodhd.com/api/eod/GBPUSD.FOREX (filed 2026-04-07); FY2016: growth capex 0; upkeep 281041398.07692313; owner earnings 277243541.346154. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/eod/GBPUSD.FOREX (filed 2026-04-07); FY2017: growth capex 0; upkeep 249144867.35483876; owner earnings 889269399.870968. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/eod/GBPUSD.FOREX (filed 2026-04-07); FY2019: growth capex 0; upkeep 218238207.98722062; owner earnings 476440789.62939346. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/eod/GBPUSD.FOREX (filed 2026-04-07); FY2020: growth capex 0; upkeep 196384546.00318483; owner earnings 383724173.7261149. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/eod/GBPUSD.FOREX (filed 2026-04-07); FY2021: growth capex 0; upkeep 0; owner earnings 702284526.0948496. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/eod/GBPUSD.FOREX (filed 2026-04-07); FY2022: growth capex 0; upkeep 0; owner earnings 653068357.5961536. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2023: growth capex 0; upkeep 262000000; cash acquisitions 274000000; owner earnings 689600000. Growth capex plus acquisitions / owner earnings = 0.39733178654292345.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2024: growth capex 0; upkeep 275000000; cash acquisitions 219000000; owner earnings 653600000. Growth capex plus acquisitions / owner earnings = 0.3350673194614443.

- Source: https://filings.xbrl.org/549300VN4WV7Z6T14K68/2025-12-31/ESEF/GB/0/549300VN4WV7Z6T14K68-2025-12-31/reports/549300VN4WV7Z6T14K68-2025-12-31-T01.html (filed 2026-04-07); FY2025: growth capex 0; upkeep 269000000; cash acquisitions 0; owner earnings 651400000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); Dividend observations: [[2016,75278945.91346157],[2017,82833583.09677422],[2018,99081998.05111821],[2019,109566051.75718859],[2020,0],[2021,0],[2022,0],[2023,252000000],[2024,292000000],[2025,304000000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 2.8% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); RTO.LSE SharesStats.PercentInsiders = 2.765 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 0.1% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); Ten-year compound average after fade. Initial solved rate -0.011893050464075572. Price 311.5; FX 75.34943299551671; discount 0.1; same standard ten-year fade to terminal 0.03.  Closing-price date 2026-10-15.

## Monthly share-price history (GBX per share)

- 2016-10: GBX 228.30 per share

- 2016-11: GBX 214.40 per share

- 2016-12: GBX 222.20 per share

- 2017-01: GBX 228.50 per share

- 2017-02: GBX 239.10 per share

- 2017-03: GBX 246.70 per share

- 2017-04: GBX 249.00 per share

- 2017-05: GBX 265.60 per share

- 2017-06: GBX 273.30 per share

- 2017-07: GBX 290.60 per share

- 2017-08: GBX 304.50 per share

- 2017-09: GBX 300.60 per share

- 2017-10: GBX 335.80 per share

- 2017-11: GBX 318.10 per share

- 2017-12: GBX 318.00 per share

- 2018-01: GBX 297.00 per share

- 2018-02: GBX 289.60 per share

- 2018-03: GBX 271.70 per share

- 2018-04: GBX 307.00 per share

- 2018-05: GBX 342.60 per share

- 2018-06: GBX 350.80 per share

- 2018-07: GBX 339.30 per share

- 2018-08: GBX 325.00 per share

- 2018-09: GBX 318.40 per share

- 2018-10: GBX 316.20 per share

- 2018-11: GBX 330.00 per share

- 2018-12: GBX 337.20 per share

- 2019-01: GBX 337.00 per share

- 2019-02: GBX 351.00 per share

- 2019-03: GBX 353.30 per share

- 2019-04: GBX 390.00 per share

- 2019-05: GBX 375.00 per share

- 2019-06: GBX 397.50 per share

- 2019-07: GBX 435.00 per share

- 2019-08: GBX 450.20 per share

- 2019-09: GBX 467.80 per share

- 2019-10: GBX 454.50 per share

- 2019-11: GBX 444.90 per share

- 2019-12: GBX 453.00 per share

- 2020-01: GBX 467.00 per share

- 2020-02: GBX 484.00 per share

- 2020-03: GBX 387.80 per share

- 2020-04: GBX 474.30 per share

- 2020-05: GBX 496.80 per share

- 2020-06: GBX 509.60 per share

- 2020-07: GBX 534.20 per share

- 2020-08: GBX 533.00 per share

- 2020-09: GBX 535.60 per share

- 2020-10: GBX 526.00 per share

- 2020-11: GBX 497.30 per share

- 2020-12: GBX 509.60 per share

- 2021-01: GBX 497.60 per share

- 2021-02: GBX 466.70 per share

- 2021-03: GBX 484.40 per share

- 2021-04: GBX 500.40 per share

- 2021-05: GBX 473.80 per share

- 2021-06: GBX 495.00 per share

- 2021-07: GBX 566.80 per share

- 2021-08: GBX 580.40 per share

- 2021-09: GBX 583.60 per share

- 2021-10: GBX 588.40 per share

- 2021-11: GBX 613.60 per share

- 2021-12: GBX 584.00 per share

- 2022-01: GBX 518.20 per share

- 2022-02: GBX 507.80 per share

- 2022-03: GBX 526.00 per share

- 2022-04: GBX 550.00 per share

- 2022-05: GBX 506.20 per share

- 2022-06: GBX 474.60 per share

- 2022-07: GBX 541.20 per share

- 2022-08: GBX 521.00 per share

- 2022-09: GBX 477.50 per share

- 2022-10: GBX 544.40 per share

- 2022-11: GBX 541.40 per share

- 2022-12: GBX 508.00 per share

- 2023-01: GBX 490.70 per share

- 2023-02: GBX 512.40 per share

- 2023-03: GBX 591.60 per share

- 2023-04: GBX 632.40 per share

- 2023-05: GBX 638.60 per share

- 2023-06: GBX 615.00 per share

- 2023-07: GBX 635.00 per share

- 2023-08: GBX 601.80 per share

- 2023-09: GBX 610.20 per share

- 2023-10: GBX 416.80 per share

- 2023-11: GBX 428.70 per share

- 2023-12: GBX 440.80 per share

- 2024-01: GBX 408.30 per share

- 2024-02: GBX 438.30 per share

- 2024-03: GBX 471.70 per share

- 2024-04: GBX 407.10 per share

- 2024-05: GBX 414.30 per share

- 2024-06: GBX 461.20 per share

- 2024-07: GBX 474.70 per share

- 2024-08: GBX 483.00 per share

- 2024-09: GBX 364.40 per share

- 2024-10: GBX 387.50 per share

- 2024-11: GBX 393.80 per share

- 2024-12: GBX 400.80 per share

- 2025-01: GBX 398.80 per share

- 2025-02: GBX 398.00 per share

- 2025-03: GBX 347.60 per share

- 2025-04: GBX 342.60 per share

- 2025-05: GBX 351.60 per share

- 2025-06: GBX 352.10 per share

- 2025-07: GBX 379.50 per share

- 2025-08: GBX 365.00 per share

- 2025-09: GBX 375.80 per share

- 2025-10: GBX 421.70 per share

- 2025-11: GBX 416.20 per share

- 2025-12: GBX 447.50 per share

- 2026-01: GBX 450.70 per share

- 2026-02: GBX 456.20 per share

- 2026-03: GBX 467.00 per share

- 2026-04: GBX 493.70 per share

- 2026-05: GBX 448.80 per share

- 2026-06: GBX 426.60 per share

- 2026-07: GBX 344.80 per share

- 2026-08: GBX 345.70 per share

- 2026-09: GBX 297.20 per share

- 2026-10: GBX 311.50 per share

## Annual estimated value (GBX per share)

- FY2020: low GBX 281.75 per share, central GBX 305.14 per share, high GBX 336.27 per share

- FY2021: low GBX 279.74 per share, central GBX 313.73 per share, high GBX 358.98 per share

- FY2022: low GBX 352.93 per share, central GBX 388.53 per share, high GBX 435.92 per share

- FY2023: low GBX 341.53 per share, central GBX 380.97 per share, high GBX 433.47 per share

- FY2024: low GBX 263.40 per share, central GBX 295.50 per share, high GBX 338.23 per share

- FY2025: low GBX 307.22 per share, central GBX 340.64 per share, high GBX 385.13 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original ESEF filing](https://filings.xbrl.org/549300VN4WV7Z6T14K68/2025-12-31/ESEF/GB/0/549300VN4WV7Z6T14K68-2025-12-31/reports/549300VN4WV7Z6T14K68-2025-12-31-T01.html); period 2025-12-31, filed 2026-04-07.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.