ROL is historically cheap but possibly only at fair value; big tech offers better opportunity cost.

Now, finally, stock number five, we have Rollins, ticker symbol ROL, and this is for the core fans, the people in the community, because they were the ones that wanted to see this stock.

And you can see they had a sharp drop-off here. Recently hit 52-week low on Friday. It's down 17% over the past 5 years and 48% this year.

But in the long run, this has been a great performer in the market. With dividends reinvested, if you go back to the 1980s, it's growing at 13% CAGR, even with this last year being terrible.

Now, I'm not in this space, so I'm not necessarily a Rollins guy. But basically, they are a conglomerate pest control company. So, they own a bunch of regional pest control companies, and they are the biggest one in the US.

They own the most of them. And it's been a great business over the decades.

Here you can see their dividend. It's consistently gone up over time, and they sprinkle in these special dividends along the way, and they've been raising the base quarterly dividend over time.

You can see over the past 10 years the dividends up 310%. That's a 15.17% CAGR, and they had these special dividends along the way.

It's a historically high dividend yield right now. Massive outlier over the past 10 years. It's even higher than the yields with all of those special dividends.

I would say they're not at risk of a dividend cut. It's 55% free cash flow payout ratio over the trailing 12 months, 64% earnings payout ratio. Here you can see earnings per share.

It's been a consistent grower over the past 25 years. Earnings per share is up 241% over the past 10 years. 13.4% compound annual growth rate. It's up 75% over the past 5 years.

That's a 12.65% CAGR, and it's kept growing over the past 3 years. Trailing 12 months they're up 11.5%.

Now, they did report a miss on their latest earnings report. It's down 4.7% from expectations, and the company's P/E ratio right now is historically cheap at a 27.3 trailing 12-month P/E ratio.

This is the lowest it's been over the past 10 years,

but I find this actually be surprising the multiple that Rollins stock has traded at. A 53 10-year median P/E ratio. Even over the past 5 years the median's 51.49. Intuitively that doesn't make much sense to me, to be honest, and this 27.3, yes, it's the cheapest ever been, but I don't think it's like a steal necessarily at that. They're growing like 10 to 15% a year.

Maybe I need to do some more research into their business to understand why they got that premium multiple for all those years.

The free cash flow generations are really good. It's up 258% over the past 10 years. 14% compound annual growth rate. It's up 68% over the past 5 years. Although it is starting to decline in recent quarters for free cash flow.

Overall, based on the financials or anything, I don't think they're at risk of a dividend cut. The business isn't dying or anything like that. Analysts are still expecting continued higher earnings per share growth. 5% 2026, and then 10% in the years after.

And again, compared to the historic multiples, the stock does look cheap right now. No matter what you look at, earnings per share, dividend, free cash flow. And when I'm looking at this, the only thing that I'm necessarily like thinking about is that yeah, it's cheap compared to how it's historically traded, but did it really deserve that premium in the past? Maybe it's just closer to fair value right now.

Which that's not bad. Sometimes buying a stock when it's at fair value is a very good move if it's a quality company. It's going to continue growing in the long run. But I mean, there are big tech companies trading at cheaper multiple.

They are growing way faster. And I always do that mental opportunity cost of like you could put your money in this or you could put your money in that.

So I don't know. That's just me as I I'm not in the pest control business. I don't have any insight into this. Perhaps I could do some research if it keeps getting cheaper. Maybe do a dedicated video.