A month has gone by since the last earnings report for Rollins (ROL Quick QuoteROL - Free Report) . Shares have added about 10.1% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Rollins due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Rollins Q4 Earnings Meet Estimates

Rollins, Inc. fourth-quarter 2023 earnings meet the Zacks Consensus Estimate and revenues beat the same.

Adjusted earnings of 21 cents per share increased 23.5% year over year. Revenues of $754.1 million beat the consensus mark by 0.5% and improved 14% year over year. Organic revenues of $708.4 million increased 7.3% year over year.

Rollins’ performance in the quarter was positively impacted by a healthy demand environment for its services. Management said that the company remains well-positioned for organic as well as inorganic growth. Rollins’ acquisitions pipeline remained strong in the quarter.

Quarter Details

Residential revenues increased 17.7% year over year to $340.5 million and beat our estimate of $325.5 million. Commercial revenues increased 10.6% year over year to $256.7 million and surpassed our estimate of $252.5 million. Termite and ancillary revenues increased 13.4% year over year to $147.9 million and beat our estimate of $145.8 million.

Adjusted EBITDA of $166.7 million increased 14.2% year over year. This compares to our expectation of an adjusted EBITDA of $154.8 million, up 7.4% year over year. Adjusted EBITDA margin of 22.1% stayed flat year over year compared with our expectation of an adjusted EBITDA margin of 21%, down 110 bps year over year.

Rollins exited the quarter with a cash and cash equivalents balance of $103.8 million compared with the prior quarter’s $142.2 million. Long-term debt at the end of the quarter was $490.8 million compared with $596.6 million at the end of the prior quarter.

The company generated $152.8 million of cash from operating activities in the quarter and capital expenditure was $11.2 million. Free cash flow came in at $141.6 million. The company paid dividends worth $73 million in the quarter.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision flatlined during the past month.

VGM Scores

At this time, Rollins has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Rollins has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.