Shares of Rentokil Initial slid to a 52-week low of $23.24 on Tuesday, extending a year-to-date decline of 19% and leaving the stock 33% below its 52-week peak of $34.66.
The decline follows a downgrade by BNP Paribas Exane, which cut its rating on Rentokil from Outperform to Neutral. The move reflects broader market headwinds and company-specific challenges, including weaker residential lead generation in North America and concerns over restructuring efforts.
First-half revenue rose 4.5% to $3.589 billion, below the $3.661 billion forecast, while operating profit increased 6.6%. North American revenue grew 4.2% to $2.197 billion, while international revenue climbed 5.0% to $1.392 billion. Free cash flow advanced 12.8%, with a cash conversion rate of 96%.
Rentokil also retired its 2027 North America margin target of 20%, signaling a shift in strategic priorities. Despite the mixed results, the company’s pest control operations showed organic growth improvements outside North America, though its core U.S. pest control business faced slower momentum.
