5 Stocks to Buy Now According to Jeffrey Gates’ Gates Capital

2. Terminix Global Holdings, Inc. (NYSE:TMX)

Gates Capital Stake Value: $234,384,000
Percentage of Gates Capital’s 13F Portfolio: 6.48%
Number of Hedge Fund Holders: 32

Terminix Global Holdings, Inc. (NYSE:TMX) is a residential and commercial services provider. It provides termite and pest control services for both residential and commercial properties, as well as national pest control services, restoration, commercial and residential cleaning, furniture repair, and house inspections. On December 14, William Blair analyst Tim Mulrooney initiated coverage of Terminix Global Holdings, Inc. (NYSE:TMX), rating the stock as Outperform and giving a price objective of $55.

Terminix Global Holdings, Inc. (NYSE:TMX), on March 1, posted its Q4 results. The company announced earnings per share of $0.20, below estimates by $0.02. Revenue over the period totaled $484 million, up 5.2% year-over-year. Higher pricing realization and improved trailing 12-month client retention rates drove revenue growth.

By the end of the fourth quarter, Insider Monkey found Terminix Global Holdings, Inc. (NYSE:TMX) to be a part of 32 hedge fund portfolios. The total stakes that these funds had in the company are worth $696.02 million, up from $380.52 million the prior quarter with 20 positions.

In its fourth quarter 2021 investor letter, Cooper Investors discussed its stance on Terminix Global Holdings, Inc. (NYSE:TMX). Here is what the fund said:

“In mid-December portfolio holding Rentokil Initial announced its intention to acquire US-listed Terminix Global Holdings for around US$6bn. As a reminder Rentokil is the world’s largest Pest Control business, providing annual contract-based prevention and extermination services to residential, commercial and government customers in over 80 countries across the globe.

Terminix is the largest provider of home termite services in the US and a top three player in residential and commercial pest. This deal will roughly double the size of Rentokil’s Pest Control business in North America and take them to number one in terms of market share. While we are typically wary of large acquisitions that attract the label of ‘transformational’ we feel positive about this transaction for several reasons.…” (Click here to see the full text)