ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Rentokil Initial's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2025 was 3.48%.
As of today (2026-06-25), Rentokil Initial's WACC % is 10.27%. Rentokil Initial's ROIC % is 3.78% (calculated using TTM income statement data).
Rentokil Initial earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Rentokil Initial (MEX:RTON) ROIC % Explanation
ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.
There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.
Why is ROIC % important?
Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Rentokil Initial's WACC % is 10.27%. Rentokil Initial's ROIC % is 3.78% (calculated using TTM income statement data).
Rentokil Initial earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
Like ROE % and ROA %, ROIC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Rentokil Initial ROIC % Related Terms
Rentokil Initial ROIC % Historical Data
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The historical data trend for Rentokil Initial's ROIC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Specialty Business Services subindustry, Rentokil Initial's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Rentokil Initial ROIC % vs Business Services Industry
For the Business Services industry and Industrials sector, Rentokil Initial's ROIC % distribution charts can be found below:
* The bar in red indicates where Rentokil Initial's ROIC % falls into.
Note:
The Operating Income data used here is two times the semi-annual (Dec. 2025) data.
The tax rate is limited to between 0% and 100%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Rentokil Initial (MEX:RTON) has a ROIC % of 3.48% as of Dec. 2025. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Rentokil Initial and its competitors.
Is Rentokil Initial's ROIC % too high?
Rentokil Initial's current ROIC % is 3.48%. The Business Services industry median ROIC % is 5.93. Rentokil Initial's value of 3.48% is 41.3% below this industry median. Overall, Rentokil Initial has a GF Score™ of 87/100, reflecting its overall financial health beyond just this single metric.
How does Rentokil Initial's ROIC % compare to CTAS and CPRT?
Rentokil Initial's ROIC % of 3.48% can be compared against companies in the Business Services industry. The industry median ROIC % is 5.93. Rentokil Initial's value of 3.48% is 41.3% below this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROIC % for a Business Services company?
The median ROIC % among Business Services companies is 5.93, based on 1,075 companies in the industry. Companies in the top quartile (top 25%) have a ROIC % significantly above this median, while those in the bottom quartile fall well below. However, ROIC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Rentokil Initial's current ROIC % of 3.48% is 41.3% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROIC % mean?
A high ROIC % can signal that a stock is expensive relative to its fundamentals. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Rentokil Initial and its competitors. For the Business Services industry, the median ROIC % is 5.93 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Rentokil Initial's current ROIC % is 3.48%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Rentokil Initial stock overvalued right now?
Rentokil Initial (MEX:RTON) has a current ROIC % of 3.48%. The stock's GF Value™ is MXN117.99, compared to a current price of MXN116.32 — trading 1.4% below its estimated fair value. The current ROIC % is 3.48% and 41.3% below the Business Services industry median of 5.93. Rentokil Initial's overall GF Score™ is 87/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROIC % calculated?
ROIC % is calculated from a company's financial statements. For Rentokil Initial (MEX:RTON), the current ROIC % is 3.48% as of Dec. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Rentokil Initial (MEX:RTON) Overvalued in 2026?
Based on GuruFocus' analysis, Rentokil Initial stock appears to be undervalued.
The current stock price of MXN116.32 is trading 1.4% below its estimated GF Value™ of MXN117.99.
Key valuation signals for MEX:RTON:
ROIC %: 3.48%
GF Value™: MXN117.99 vs. price of MXN116.32 (1.4% below fair value)
Industry Position: 41.3% below the Business Services median
No single metric tells the full story. See the MEX:RTON stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Rentokil Initial is the largest global provider of route-based pest control and commercial hygiene services, operating in over 90 countries, with its largest operations in the United States following the acquisition of Terminix. The group also offers a range of specialist route-based services, including office and commercial space plant care, property care, and workwear rentals. The group serves a diverse client base of global food producers, hotel chains, industrial goods companies, restaurants, and individual residential customers.
87GF Score
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