Critical Comparison: Rentokil Initial (NYSE:RTO) versus Mitie Group (OTCMKTS:MITFY)

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

Earnings & Valuation

This table compares Rentokil Initial and Mitie Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rentokil Initial	$6.91 billion	2.24	$470.00 million	N/A	N/A
Mitie Group	$7.53 billion	0.38	$121.04 million	N/A	N/A

Rentokil Initial has higher earnings, but lower revenue than Mitie Group.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Rentokil Initial	N/A	N/A	N/A
Mitie Group	N/A	N/A	N/A

Dividends

Rentokil Initial pays an annual dividend of $0.72 per share and has a dividend yield of 2.4%. Mitie Group pays an annual dividend of $0.12 per share and has a dividend yield of 1.4%.

Analyst Recommendations

This is a summary of current ratings and target prices for Rentokil Initial and Mitie Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rentokil Initial	1	4	6	1	2.58
Mitie Group	0	0	0	1	4.00

Rentokil Initial presently has a consensus target price of $34.50, suggesting a potential upside of 12.63%. Given Rentokil Initial’s higher probable upside, equities analysts clearly believe Rentokil Initial is more favorable than Mitie Group.

Volatility and Risk

Rentokil Initial has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, Mitie Group has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500.

Institutional & Insider Ownership

9.9% of Rentokil Initial shares are owned by institutional investors. Comparatively, 0.2% of Mitie Group shares are owned by institutional investors. 0.8% of Mitie Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Rentokil Initial beats Mitie Group on 6 of the 10 factors compared between the two stocks.

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.

About Mitie Group

Mitie Group plc, together with its subsidiaries, provides facilities management and professional services in the United Kingdom and internationally. The company operates in four segments: Business Services, Technical Services, Central Government & Defense (CG&D), Communities. The company provides decarbonization, electrical grid connections, emission intelligence, energy and carbon, EV fleets, and heat solutions, as well as solar energy; cleaning and hygiene, engineering maintenance, integrated facilities management, landscape, and waste management services; project and workplace services; and Fire & security systems, front of house, intelligence, vetting, and security guarding service. It serves to financial, professional, life science, manufacturing, media, telecom and tech, retail, shopping centres, transport, utilities, central and local government, critical environment, defence, education, healthcare, and justice and immigration sectors. The company was incorporated in 1936 and is headquartered in London, the United Kingdom.