Critical Review: Rentokil Initial (NYSE:RTO) versus Worley (OTCMKTS:WYGPY)

Worley (OTCMKTS:WYGPY) and Rentokil Initial (NYSE:RTO) are both business services companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, institutional ownership, dividends, analyst recommendations, profitability, risk and earnings.

Insider and Institutional Ownership

9.9% of Rentokil Initial shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk & Volatility

Worley has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500. Comparatively, Rentokil Initial has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500.

Valuation & Earnings

This table compares Worley and Rentokil Initial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Worley	$7.28 billion	0.58	$264.87 million	N/A	N/A
Rentokil Initial	$6.95 billion	2.14	$392.32 million	N/A	N/A

Rentokil Initial has lower revenue, but higher earnings than Worley.

Profitability

This table compares Worley and Rentokil Initial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Worley	N/A	N/A	N/A
Rentokil Initial	N/A	N/A	N/A

Dividends

Worley pays an annual dividend of $0.26 per share and has a dividend yield of 3.1%. Rentokil Initial pays an annual dividend of $0.33 per share and has a dividend yield of 1.1%.

Analyst Ratings

This is a summary of recent ratings and target prices for Worley and Rentokil Initial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Worley	0	0	1	0	3.00
Rentokil Initial	1	2	4	1	2.63

Rentokil Initial has a consensus target price of $34.00, suggesting a potential upside of 15.33%. Given Rentokil Initial’s higher possible upside, analysts clearly believe Rentokil Initial is more favorable than Worley.

Summary

Rentokil Initial beats Worley on 7 of the 10 factors compared between the two stocks.

About Worley

Worley Limited provides professional project and asset services to energy, chemicals, and resources sectors worldwide. The company offers digital, consulting, engineering and design, construction management, construction and fabrication, supply chain management, project management, and operation and maintenance services, as well as maintenance, modification, and operation services. It serves new energy, power, upstream and midstream, refining and chemicals, and infrastructure markets, as well as mining, minerals, and metals markets. The company was formerly known as WorleyParsons Limited and changed its name to Worley Limited in October 2019. The company was founded in 1893 and is based in Sydney, Australia.

About Rentokil Initial

Rentokil Initial plc, together with its subsidiaries, provides route-based services in North America, the United Kingdom, rest of Europe, Asia, the Pacific, and internationally. It offers a range of pest control services for rodents, and flying and crawling insects, as well as other forms of wildlife management for commercial customers. The company provides hygiene services, including the provision and maintenance of products, such as soap and hand sanitizer dispensers, hand dryers, air care and purification, cubicle and surface sanitizers, feminine hygiene units, toilet paper dispensers, and floor protection mats. In addition, it engages in the supply and maintenance of workwear and protective equipment. Further, the company offers property care services; and provides a range of specialist cleaning services, such as graffiti removal deep cleaning of kitchens and washrooms, trauma cleaning, and flood or fire damage cleaning, as well as specialist medical and hygiene services. Rentokil Initial plc was founded in 1903 and is headquartered in Crawley, the United Kingdom.