What it is: An asset-light business: the value sits in intellectual property and people, not plant, so the question is how durable the advantage is, not how high the margin.
Situation: Serial acquirer. Goodwill and acquired intangibles are 51% of assets, with meaningful acquisition spending in 10 of the record's 10 years; much of what this business is was bought, at prices the record carries.
What moves the needle: Gross margin has run about 51% and operating margin about 18% through the cycle, a wide spread between price and the cost of what it sells — whether that advantage is durable pricing power or a margin that can erode is the question the record is for. That margin has held in a narrow 16%–19% band over the years, so steadiness itself is the evidence — the lever is unit growth and cost discipline, not a moving line. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has run high across the record (median 30%, above 15% in 10 of 10 years), though buybacks and expensed R&D and brands shrink the capital base, so the figure overstates the underlying economics. The steadier read is owner earnings: roughly 16% of revenue reaches owners as cash, consistently. Whether these returns reflect real pricing power or an accounting artifact is the judgment the 10-K is for.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

Revenue spreads across 5 lines, the largest Residential Revenue at 45%.

Revenue by product line, FY2025

Residential Revenue45%$1.7B
Commercial Revenue33%$1.2B
Termite and ancillary revenues21%$782M
Other revenues1%$25M
Franchise0%$16M

By geographyUnited States93%International7%

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$1.6B	$1.7B	$1.8B	$2.0B	$2.2B	$2.4B	$2.7B	$3.1B	$3.4B	$3.8B	$3.8B	RevenueRevenue
51%	51%	51%	51%	51%	—	—	—	—	—	71%	Gross marginGross mgn
31%	30%	30%	31%	30%	30%	30%	30%	30%	30%	30%	SG&A / revenueSG&A/rev
$261M	$295M	$311M	$317M	$376M	$448M	$493M	$583M	$657M	$726M	$729M	Operating incomeOp. inc.
16.6%	17.6%	17.1%	15.7%	17.4%	18.5%	18.3%	19.0%	19.4%	19.3%	19.0%	Operating marginOp. mgn
$167M	$179M	$232M	$203M	$267M	$357M	$369M	$435M	$466M	$527M	$529M	Net incomeNet inc.
36%	39%	25%	22%	26%	26%	26%	26%	26%	25%	24%	Effective tax rateTax rate
											Cash flow & returns
$227M	$235M	$299M	$320M	$436M	$402M	$466M	$528M	$608M	$678M	$650M	Operating cash flowOp. cash
$51M	$57M	$67M	$81M	$88M	$87M	$91M	$100M	$113M	$125M	$128M	DepreciationDeprec.
($4M)	($13M)	($13M)	$21M	$60M	($56M)	($15M)	($31M)	($2M)	($13M)	($49M)	Working capital & otherWC & other
$33M	$25M	$27M	$27M	$23M	$27M	$31M	$32M	$28M	$28M	$28M	CapexCapex
2.1%	1.5%	1.5%	1.3%	1.1%	1.1%	1.1%	1.1%	0.8%	0.7%	0.7%	Capex / revenueCapex/rev
$193M	$211M	$272M	$292M	$413M	$375M	$435M	$496M	$580M	$650M	$621M	Owner earningsOwner earn.
12.3%	12.6%	14.9%	14.5%	19.1%	15.5%	16.1%	16.1%	17.1%	17.3%	16.2%	Owner earnings marginOE mgn
$193M	$211M	$272M	$292M	$413M	$375M	$435M	$496M	$580M	$650M	$621M	Free cash flowFCF
12.3%	12.6%	14.9%	14.5%	19.1%	15.5%	16.1%	16.1%	17.1%	17.3%	16.2%	Free cash flow marginFCF mgn
$46M	$130M	$77M	$431M	$148M	$146M	$119M	$367M	$157M	$310M	$301M	AcquisitionsAcquis.
$109M	$122M	$153M	$154M	$160M	$209M	$212M	$264M	$298M	$328M	$336M	Dividends paidDiv. paid
$31M	$8M	$10M	$10M	$8M	$11M	$7M	$315M	$12M	$217M	—	BuybacksBuybacks
39%	33%	39%	24%	26%	29%	30%	28%	30%	31%	31%	ROICROIC
29%	27%	33%	24%	28%	32%	29%	38%	35%	38%	38%	Return on equityROE
10%	9%	11%	6%	11%	13%	12%	15%	13%	14%	14%	Retained to equityRetained/eq
											Balance sheet
$143M	$107M	$115M	$94M	$98M	$105M	$95M	$104M	$90M	$100M	$117M	Cash & investmentsCash+inv
$88M	$98M	$104M	$123M	$126M	$140M	$156M	$178M	$196M	$203M	$211M	ReceivablesReceiv.
$14M	$15M	$16M	$19M	$31M	$29M	$30M	$33M	$40M	$43M	$44M	InventoryInvent.
$30M	$26M	$27M	$35M	$65M	$45M	$43M	$49M	$50M	$44M	$61M	Accounts payablePayables
$72M	$87M	$93M	$107M	$93M	$124M	$143M	$162M	$186M	$201M	$194M	Operating working capitalOper. WC
$290M	$263M	$286M	$310M	$315M	$352M	$349M	$407M	$443M	$473M	$514M	Current assetsCur. assets
$277M	$295M	$299M	$410M	$473M	$491M	$494M	$577M	$645M	$786M	$795M	Current liabilitiesCur. liab.
1.0×	0.9×	1.0×	0.8×	0.7×	0.7×	0.7×	0.7×	0.7×	0.6×	0.6×	Current ratioCurr. ratio
$256M	$347M	$368M	$573M	$718M	$787M	$847M	$1.1B	$1.2B	$1.4B	$1.4B	GoodwillGoodwill
$917M	$1.0B	$1.1B	$1.7B	$1.8B	$2.0B	$2.1B	$2.6B	$2.8B	$3.1B	$3.2B	Total assetsAssets
—	—	—	$279M	$186M	$136M	$40M	$491M	$395M	$486M	$487M	Total debtDebt
—	—	—	$185M	$87M	$31M	($55M)	$387M	$306M	$386M	$370M	Net debt / (cash)Net debt
—	—	—	—	—	—	187.0×	30.6×	23.7×	25.4×	23.1×	Interest coverageInt. cov.
$569M	$654M	$712M	$833M	$965M	$1.1B	$1.3B	$1.2B	$1.3B	$1.4B	$1.4B	Shareholders’ equityEquity
0.8%	0.7%	0.8%	0.7%	1.0%	0.6%	0.8%	0.8%	0.9%	1.1%	1.1%	Stock comp / revenueSBC/rev
											Per share
491M	490M	491M	491M	492M	492M	492M	490M	484M	484M	481M	Shares out (diluted)Shares
$3.20	$3.41	$3.71	$4.10	$4.40	$4.93	$5.47	$6.27	$7.00	$7.77	$7.99	Revenue / shareRev/sh
$0.34	$0.37	$0.47	$0.41	$0.54	$0.72	$0.75	$0.89	$0.96	$1.09	$1.10	EPS (diluted)EPS
$0.39	$0.43	$0.55	$0.60	$0.84	$0.76	$0.88	$1.01	$1.20	$1.34	$1.29	Owner earnings / shareOE/sh
$0.39	$0.43	$0.55	$0.60	$0.84	$0.76	$0.88	$1.01	$1.20	$1.34	$1.29	Free cash flow / shareFCF/sh
$0.22	$0.25	$0.31	$0.31	$0.33	$0.42	$0.43	$0.54	$0.62	$0.68	$0.70	Dividends / shareDiv/sh
$0.07	$0.05	$0.06	$0.06	$0.05	$0.06	$0.06	$0.07	$0.06	$0.06	$0.06	Cap. spending / shareCapex/sh
$1.16	$1.33	$1.45	$1.70	$1.96	$2.26	$2.57	$2.36	$2.75	$2.84	$2.87	Book value / shareBVPS

Share counts before 2018 are restated ×1.5 for a stock split, so per-share figures sit on one basis.

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+10.3%/yr	+12.1%/yr
Owner earnings / share	+14.6%/yr	+9.9%/yr
EPS	+13.8%/yr	+14.9%/yr
Dividends / share	+13.2%/yr	+15.7%/yr
Capital spending / share	−1.6%/yr	+4.2%/yr
Book value / share	+10.5%/yr	+7.7%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked. Share counts on the current split basis.

Share count

484Mpeak FY2022

ROIC

31%low FY2019

Gross margin

51%low FY2019

Net debt ÷ owner earnings

0.6×peak FY2023

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$650Mowner earningsvs.$527Mnet incomelow FY2016

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business turned $527M of profit into $650M of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

Reported net income$527M

Owner earnings$650M · 17% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$527M	$466M	$435M	$369M	$357M
Depreciation & amortizationnon-cash charge added back	+$125M	+$113M	+$100M	+$91M	+$87M
Stock-based compensationreal costnon-cash, but a real cost	+$40M	+$30M	+$25M	+$21M	+$15M
Working capital & othertiming of cash in and out, other non-cash items	−$13M	−$2M	−$31M	−$15M	−$56M
Cash from operations	$678M	$608M	$528M	$466M	$402M
Capital expenditurecash put back in to keep running and to grow	−$28M	−$28M	−$32M	−$31M	−$27M
Owner earnings	$650M	$580M	$496M	$435M	$375M
Owner-earnings marginowner earnings ÷ revenue	17%	17%	16%	16%	15%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $40M), owner earnings is nearer $610M.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 25.4×

Comfortable

Operating income $726M ÷ interest expense $29M

What this means
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
How heavy is the debt, net of cash? $386M · 0.5× operating profit

Modest net debt

Cash $100M − debt $486M

What this means
Netting $100M of cash and short-term investments against $486M of debt leaves $386M owed, about 0.5× a year's operating profit (0.7× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 19d

Tight

DSO 20 + DIO 15 − DPO 15 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 30%

Very high (≥25%) through the cycle

10-yr median, range 24%–39%; 31% latest = NOPAT $546M ÷ invested capital $1.8B

Industry peers: median 17%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran 31% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 15%

High through the cycle

10-yr median margin, range 12%–19%; latest $650M = operating cash $678M − maintenance capex $28M

Industry peers: median 18%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 17% of revenue this year, a 15% median across 10 years. Treating stock comp as the real expense it is (less $40M of SBC) leaves $610M.
Are earnings backed by cash? 1.29×

Cash-backed

Cash from ops $678M ÷ net income $527M

In the filing’s words The filing leans on adjusted, non-GAAP earnings, but the GAAP profit is itself cash-backed — the adjustments are not papering over a cash shortfall here.

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 84%

Returns about half

Dividends + buybacks $545M ÷ Owner Earnings $650M

What this means
Of $650M Owner Earnings, $545M (84%) went back to shareholders, $328M dividends, $217M buybacks. Net of $40M stock comp, the real buyback was about $177M. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 0.23×

Harvesting

Capex $28M ÷ depreciation $125M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 4 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $3.8B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Miss

Current ratio ≥ 2× · 0.60×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Miss

Debt ≤ working capital · $486M vs ($313M) WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Pass

A profit every year (10-yr record) · no losses

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Pass

Uninterrupted dividends · paid every year (10)

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Pass

Earnings +33% over the record · +147%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $0.99/share (latest year $1.09), the averaged base the calculator's gate runs on, and book value is $2.85/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 10 of 10

What this means
Never lost money over the record, the earnings stability Graham insisted on.
Return on capital ≥ 15% 7 of 7 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 17% → 19% (3-yr avg ends)

What this means
Through the cycle the operating margin widened — about 17% early to 19% lately, median 18% — pricing power intact or improving.
Reinvestment, incremental ROIC 51%

What this means
Every extra dollar the business reinvested came back at a high incremental return — the lens GBM read for a moat that reinvests rather than merely harvests. The record and the 10-K are where you check whether the rate holds.
Owner earnings growth +13%/yr

What this means
Owner earnings grew about 13% a year over the record.
Worst year 2019 · 15.7% op. margin

What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
Share count +4.4%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.
Dividend record rising

What this means
Paid and raised the dividend across the record, the continuity Graham prized.

Does AI threaten the moat?

Moderate contestability

AI is likely to reshape costs and some products here without clearly contesting or sparing the core moat; how the company itself frames it is the tell.

In its own filing Framed as a capability

The filing positions AI as something the company uses, not something it fears.

“Our increasing reliance on artificial intelligence ("AI") technologies in our services and operations, and corresponding reliance by our competitors, present several risks that could materially adversely impact our business, financial condition, and results of operations.”

The question is whether a moat the record shows as durable outlasts a technology that lowers the cost of part of what the firm sells. The durability is read in the record above, the filing's own framing of AI beside it; the industry label decides nothing on its own.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$514M

Cash & short-term investments$117M
Receivables$211M
Inventory$44M
Other current assets$142M

Current liabilities$795M

Accounts payable$61M
Other current liabilities$733M

Current ratio0.65×all current assets ÷ what's due · Graham looked for 2×

Quick ratio0.59×stricter: inventory excluded

Cash ratio0.15×strictest: cash alone against what's due

Working capital($281M)the cushion left after near-term bills

Revenue, latest quarter vs. a year ago+10.2%the freshest read on whether the business is still growing

Current ratio, recent quarters0.8× → 0.6×

Deeper floors

Tangible book value($569M)equity stripped of goodwill & intangibles

Net current asset value($1.3B)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$903M$417M of it operating leases; with finance leases, “total fixed claims” below reaches $914M (annual-report basis)

Deferred revenue$243Mcustomer cash collected before delivery; operating float

From the company's latest filing.

Lease obligations

the lease note, SEC EDGAR →

Debt by another name. What the business owes on the property, aircraft, stores and equipment it rents rather than owns is a fixed claim due on a schedule; added back to the debt, it is the true leverage. That ladder, and what it adds to the debt on the page above.

'26$155M

'27$129M

'28$85M

'29$40M

'30$22M

later$45M

Lease payments by year, scaled to the largest; “later” is everything beyond year five, shown apart. These are the contractual cash payments, before the interest the filing imputes back out to the balance-sheet liability.

Due in the next 12 months$155Ma fixed cash payment, owed whether or not the business has a good year

Total lease payments$476Mevery year plus the tail, undiscounted: the full cash the leases will take

On the balance sheet$428Mthe present value of those payments, the recognised lease liability

True leverage: debt plus leases

On-balance-sheet debt$486M

Lease obligations (present value)$428M

Total fixed claims on the business$914M

Counting the leases the way Buffett does, the fixed claims on this business come to $914M, of which the leases are 47%. The lease wall above and the debt schedule together are the calendar of what must be paid, and when.

Lease ladder read from the ASC 842 tags in the company’s Dec 31, 2025 annual report and reconciled: the yearly buckets sum to the undiscounted total, which less the imputed interest equals the balance-sheet liability; a ladder that doesn’t tie out is withheld.

How the cash was used, 2016–2025

Over the record, the business generated $4.2B of operating cash; how management split it reads as a cash returner, paying most of what it earns straight back to owners.

Reinvested$281M · 7%
Dividends$2.0B · 48%
Buybacks$628M · 15%
Retained (debt / cash)$1.3B · 30%

Returned to owners$2.6B
67% of the owner earnings the business produced over the span, $2.0B as dividends and $628M as buybacks.
Average price paid for buybacks—
Buybacks ran $628M over the span, but the filings don't tag the share count needed to deduce the average price paid.
Net change in share count−2.0%
The diluted count fell from 491M to 481M, so the buybacks outran the stock issued to staff.
Dividend record$0.68/sh
Paid in 10 of the years on record, the per-share dividend growing about 13% a year. It was never cut over the span.
Return on what it retained62%
Of the earnings it kept rather than paid out ($564M over the span), annual owner earnings (first three years vs last three) grew $350M, so each retained $1 added about 0.62 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$1.6B51% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equityexceeds itgoodwill alone is larger than the company’s entire book equity; stripped of the acquisition premium, there is no net book worth

Cash spent acquiring$1.9Bover 10 years buying other businesses, against $281M of capital spent building

None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	Jerry E. Gahlhoff, Jr.	$8.4M	$6.2M	$375M
2022	Jerry E. Gahlhoff, Jr.	$7.8M	$9.2M	$435M
2023	Jerry E. Gahlhoff, Jr.	$6.7M	$9.2M	$496M
2024	Jerry E. Gahlhoff, Jr.	$8.2M	$9.4M	$580M
2025	Jerry E. Gahlhoff, Jr.	$9.0M	$15.3M	$650M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership5.8%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
Stock-based compensation$40M
The slice of the business handed to employees in shares this year, 1% of revenue, equal to 5% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Rollins is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

None of the 4 tests turned up a mark; each came back clean. A clean panel says only that these particular ways of being wrong are not written into the record.

Each test came back clean

Is it less profitable than it was?
Did the share count rise anyway?
Did reported profit become cash?
Did receivables and inventory outpace sales?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Commercial Services & Supplies

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
ABNBAirbnb Inc.	$12.2B	82%	15.3%	53%	21%
NIQNIQ Global Intelligence plc	$4.2B	—	-2.5%	-2%	1%
FOURShift4 Payments	$4.2B	23%	1.9%	-1%	9%
ROLRollins	$3.8B	51%	17.9%	30%	16%
CARTMaplebear Inc.	$3.7B	74%	2.4%	21%	18%
MTCHMatch Group Inc.	$3.5B	73%	26.1%	17%	27%
DDOGDatadog Inc.	$3.4B	78%	-2.3%	-1%	23%
FTDRFrontdoor Inc.	$2.1B	49%	17.0%	42%	13%
Group median	—	73%	8.9%	19%	17%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Rollins has delivered.

Today’s price $

Through the cycle, Rollins earns about $594M on its 15.8% median owner-earnings margin. This year’s 17.3% margin runs in line with that. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($594M) Net of stock comp (−$42M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25+11%/yr

Owner-earnings growth · ’16→’25+13%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $621M on 481M shares outstanding, per the 10-Q cover, as of 2026-04-13; net debt $370M. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh ROL against another business →

The owners of ROL: the meeting and the votes →

Cite: Owner Scorecard, "Rollins (ROL), the owner's record," https://ownerscorecard.com/c/ROL, data as of 2026-07-09.

Manual order: ← ROKU its page in the Manual ROOT →

Industry order: ← RMNI the Commercial Services & Supplies chapter RPAY →