Rollins: Pests and Profits

Focus: STOCKS

Jimmy Mengel Image Jimmy Mengel Editor, Outsider Club

There are some companies that will simply go on and on — regardless of market trends; indeed, the billion-dollar pest control industry is steady regardless of what the stock market and the economy are doing, states Jimmy Mengel, editor of The Crow's Nest.

When renters and homeowners were asked about the major problems they’ve had with their homes, the number one problem they cited was insects.

When you have roaches crawling around in your house, it becomes a priority. People simply don’t allow their houses to be overrun with creepy crawlies.

Pest infestations led to an increase of $6.8 billion in the operating costs for U.S. businesses last year, and an overall loss of $13.2 billion in revenue.

Yes, I said billion. This includes maintenance, repairs, and total equipment replacement. This doesn’t account for the majority of businesses that claimed pests damaged their reputation and cost them a fortune in customer compensation payouts and fines.

And we’re not just talking about cockroaches. Termites cause over $5 billion in damages annually. Bedbugs have evolved from a rare nuisance to a worldwide epidemic.

So, which company kills the most bedbugs, termites, and cockroaches, and therefore makes the most money? Enter the Orkin Man, the biggest name in pest control.

Orkin is owned by parent company Rollins (ROL), which also holds a stable of other of businesses that provide pest and termite control services to residential and commercial customers, including hotels, food service establishments, and food manufacturers.

While it is huge in the U.S., it has also wielded its bug-killing magic in Canada, Central America, the Caribbean, the Middle East, Asia, the Mediterranean, Europe, Africa, and Mexico.

Since Rollins is the leader in killing pests, its stock has been completely immune to any market forces.

 
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