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JPMorgan has started coverage of Rollins, the U.S. pest control company, with an Overweight rating and a $70 price target. That price suggests about 24% upside from where the stock currently trades. The bank’s analysts argue that Rollins has one of the strongest long-term growth profiles in the industrials space, thanks to its recurring revenue model and the still-low household adoption of pest control services.
The U.S. pest control market is worth more than $20 billion, yet only about 15% of households currently use professional services. JPMorgan sees this as a huge opportunity. Rollins already earns close to 80% of its revenue from recurring contracts, giving the business steady cash flow and protection against downturns. The brokerage expects organic growth of around 7–8% annually, supported by modest price increases, margin improvements, and a steady stream of small acquisitions.
Looking ahead, JPMorgan’s earnings forecasts for 2025 and 2026 are 3–5% above Wall Street’s consensus. Analysts expect double-digit profit growth over the next two years, with EBITDA margins climbing from 22–23% today to about 25% by 2027. They credit productivity gains and better technician retention as key drivers.
By customer type, about 46% of Rollins’ revenue comes from residential services, 34% from commercial clients, and 21% from termite and related work. JPMorgan says the company’s national scale, trusted brand reputation, and service quality give it an edge in a fragmented industry where many competitors are small, local operators.
The firm also praised Rollins’ conservative balance sheet, reliable free cash generation, and financial flexibility. Near-term catalysts include a new enterprise resource planning rollout, procurement savings, continued acquisitions, and selective expansion into international markets. Together, these moves could reinforce Rollins’ reputation as both a defensive play and a structural growth story.
Although the stock trades at about 30 times forward EBITDA, JPMorgan believes that premium valuation is justified given its recurring revenues, resilience, and long growth runway.