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Cintas (CTAS)
:CTAS
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Cintas
(NASDAQ:CTAS)
Rating:76Outperform
Price Target:―
Positive Factors
Earnings
The company experienced strong profitability and exceeded expectations on EBIT margins, which contributed to a positive earnings per share outcome.
Financial Guidance
Management raised the organic revenue growth guidance, indicating confidence in the company's future performance.
Revenue Growth
Revenue growth was led by the First Aid segment, continuing to show double-digit growth, which supports overall company strength.
Negative Factors
Business Acquisition
CTAS did not elaborate further on the terminated pursuit of UNF because it was unable to enter substantive engagement with UNF on key transaction items.
IT Costs
Margins likely pressured in the Fire business on higher IT costs.
Macro Environment
Potential headwinds could include revenue growth/operating leverage gains likely slowing modestly amid choppier macro.
Cintas (CTAS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$89.99B
Dividend Yield0.68%
Average Volume (3M)1.63M
Price to Earnings (P/E)51.7
Beta (1Y)0.87
Revenue Growth7.79%
EPS Growth19.09%
CountryUS
Employees46,500
SectorIndustrials
Sector Strength90
IndustrySpecialty Business Services
Share Statistics
EPS (TTM)1.13
Shares Outstanding403,786,960
10 Day Avg. Volume1,446,187
30 Day Avg. Volume1,634,302
Financial Highlights & Ratios
PEG Ratio12.89
Price to Book (P/B)18.88
Price to Sales (P/S)0.00
P/FCF Ratio47.46
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue2.26
Enterprise Value/Gross Profit17.75
Enterprise Value/Ebitda8.35
Forecast
1Y Price Target
$213.82Price Target Upside-3.27% Downside
Rating ConsensusHold
Number of Analyst Covering13
Cintas Business Overview & Revenue Model
Company DescriptionCintas Corporation provides corporate identity uniforms and related business services primarily in the United States, Canada, and Latin America. It operates through Uniform Rental and Facility Services, First Aid and Safety Services, and All Other segments. The company rents and services uniforms and other garments, including flame resistant clothing, mats, mops and shop towels, and other ancillary items; and provides restroom cleaning services and supplies, as well as sells uniforms. It also offers first aid and safety services, and fire protection products and services. The company provides its products and services through its distribution network and local delivery routes, or local representatives to small service and manufacturing companies, as well as major corporations. Cintas Corporation was founded in 1968 and is headquartered in Cincinnati, Ohio.
How the Company Makes MoneyCintas makes money primarily through its comprehensive rental and sales programs. Its core revenue streams include uniform rental and facility services, which encompass laundering and delivering uniforms and providing essential facility maintenance products like mats, mops, and restroom supplies. The company also generates income from selling first aid and safety products, offering fire protection services, and providing document management solutions. Cintas benefits from long-term contracts and recurring revenue due to the essential nature of its services and products. Additionally, strategic partnerships with businesses across various industries contribute to stable revenue growth and expand its market reach.
Cintas Key Performance Indicators (KPIs)
Any
Revenue by Segment
Shows how much each business unit contributes to overall sales, indicating the company's diversification and identifying key growth areas or potential vulnerabilities.
Shows how much each business unit contributes to overall sales, indicating the company's diversification and identifying key growth areas or potential vulnerabilities.
Data provided by:
Main Street Data
Main Street DataCintas Financial Statement Overview
Summary
Cintas showcases strong financial health with consistent revenue and profit growth, solid margins, and improving balance sheet metrics. The company's strategic management of debt and effective cash flow generation position it well for future growth. While cash reserves could be higher, the overall financial stability is commendable, with robust shareholder returns and a strong equity position.Income Statement
Cintas shows impressive revenue growth, with a consistent upward trajectory from $7.08 billion in 2020 to $10.14 billion TTM. The gross profit margin remains robust at nearly 50%, and net profit margin has increased to 17.5% TTM, reflecting efficient cost management. EBIT and EBITDA margins are strong, indicating operational efficiency. Overall, the company demonstrates strong revenue growth and profitability.85
Very Positive
Balance Sheet
The balance sheet is solid with a debt-to-equity ratio decreasing from 0.92 in 2020 to 0.14 TTM, indicating reduced leverage risk. The return on equity has improved to 38.7% TTM, showcasing high profitability relative to shareholder equity. The equity ratio has also increased to 47.8% TTM, indicating a strong equity base. However, there is room for improvement in terms of cash reserves.78
Positive
Cash Flow
Cintas exhibits positive cash flow trends, with free cash flow growing from $1.06 billion in 2020 to $1.83 billion TTM. The free cash flow to net income ratio is robust, indicating effective cash conversion and strong operational performance. Operating cash flow has also been consistently strong, supporting ongoing investments and financial stability.82
Very Positive
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 10.14B | 9.60B | 8.82B | 7.85B | 7.12B | 7.09B | Gross Profit |
| 5.02B | 4.69B | 4.17B | 3.63B | 3.31B | 3.23B | EBIT |
| 2.31B | 2.07B | 1.80B | 1.59B | 1.39B | 1.16B | EBITDA |
| 2.84B | 2.52B | 2.22B | 1.99B | 1.77B | 1.54B | Net Income Common Stockholders |
| 1.78B | 1.57B | 1.35B | 1.24B | 1.11B | 876.04M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 243.43M | 342.01M | 124.15M | 90.47M | 493.64M | 145.40M | Total Assets |
| 9.61B | 9.17B | 8.55B | 8.15B | 8.24B | 7.67B | Total Debt |
| 2.69B | 2.67B | 2.67B | 2.97B | 2.72B | 2.71B | Net Debt |
| 2.45B | 2.33B | 2.54B | 2.88B | 2.22B | 2.56B | Total Liabilities |
| 5.02B | 4.85B | 4.68B | 4.84B | 4.55B | 4.43B | Stockholders Equity |
| 4.59B | 4.32B | 3.86B | 3.31B | 3.69B | 3.24B |
| Cash Flow | Free Cash Flow | ||||
| 1.83B | 1.67B | 1.27B | 1.30B | 1.22B | 1.06B | Operating Cash Flow |
| 2.22B | 2.08B | 1.60B | 1.54B | 1.36B | 1.29B | Investing Cash Flow |
| -579.73M | -608.63M | -388.67M | -402.63M | -137.22M | -285.40M | Financing Cash Flow |
| -1.52B | -1.25B | -1.17B | -1.54B | -879.87M | -955.21M |
Cintas Technical Analysis
Positive
221.05
Price Trends
205.52
Positive
201.78
Positive
203.62
Positive
Market Momentum
4.45
Negative
65.10
Neutral
90.75
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CTAS, the sentiment is Positive. The current price of 221.05 is above the 20-day moving average (MA) of 214.27, above the 50-day MA of 205.52, and above the 200-day MA of 203.62, indicating a bullish trend. The MACD of 4.45 indicates Negative momentum. The RSI at 65.10 is Neutral, neither overbought nor oversold. The STOCH value of 90.75 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CTAS.
Cintas Risk Analysis
Cintas disclosed 19 risk factors in its most recent earnings report. Cintas reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Cintas Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
84 Outperform | $3.37B | 23.49 | 7.17% | 0.72% | 5.04% | 31.69% | |
76 Outperform | $89.99B | 51.71 | 40.15% | 0.68% | 7.79% | 19.09% | |
75 Outperform | $11.88B | 30.42 | 7.44% | 2.17% | 3.96% | -17.48% | |
74 Outperform | $4.04B | 50.06 | 6.25% | ― | 32.27% | -40.50% | |
74 Outperform | $3.27B | 41.38 | 4.46% | 1.87% | 2.81% | -67.57% | |
71 Outperform | $10.43B | 30.63 | 11.77% | 1.00% | -3.47% | -45.03% | |
64 Neutral | $4.46B | 11.94 | 5.17% | 249.36% | 4.00% | -12.35% |
* Industrials Sector Average
Performance Comparison
CTAS
Cintas
221.05
48.34
27.99%
ABM
ABM Industries
51.41
5.10
11.01%
CBZ
CBIZ
71.72
-6.73
-8.58%
UNF
UniFirst
184.81
22.99
14.21%
ARMK
ARAMARK Holdings
38.94
7.67
24.53%
RTO
Rentokil Initial
23.25
-2.21
-8.68%
Cintas Earnings Call Summary
Earnings Call Date:Mar 26, 2025
(Q3-2025)
| % Change Since: 14.47%|
Next Earnings Date:Jul 10, 2025
Earnings Call Sentiment Positive
Cintas Corporation reported strong third quarter results with significant revenue growth, record gross margin, and increased operating income. The company also saw robust EPS growth and strong free cash flow. Strategic acquisitions and updated positive financial guidance further emphasize a strong performance. However, challenges such as the negative impact of foreign exchange rates, termination of UniFirst acquisition discussions, a decline in uniform direct sales, potential tariff impacts, and fewer workdays negatively affecting revenue growth were noted.Q3-2025 Updates
Positive Updates
Strong Revenue Growth
Third quarter total revenue grew 8.4% to $2.61 billion, with an organic growth rate of 7.9%.
Record Gross Margin
Gross margin for the third quarter grew 11.1% over the prior year to 50.6%, an all-time high.
Increased Operating Income
Operating income increased 17.1% to 23.4%, setting a new all-time high.
Robust EPS Growth
Diluted EPS grew 17.7% to $1.13, reflecting strong earnings growth.
Strong Free Cash Flow
Free cash flow for the first nine months increased 14.5% over the prior year.
Successful Strategic Acquisitions
Strategic acquisitions were made across all three route-based segments.
Updated Positive Financial Guidance
Annual revenue expectations updated to a range of $10.28 billion to $10.305 billion, with an organic revenue growth guidance of 7.4% to 7.7%.
Negative Updates
Negative Impact from Foreign Exchange Rates
Third quarter revenue growth negatively impacted by 40 basis points due to foreign exchange rates.
Termination of UniFirst Acquisition Discussions
Cintas terminated discussions with UniFirst regarding a proposed acquisition due to lack of substantive engagement.
Uniform Direct Sale Decline
Uniform direct sale was down 2.3% in the quarter.
Potential Tariff Impact
Concerns about potential increased costs from tariffs on Mexico and China.
Fewer Workdays Impact
Two fewer workdays in fiscal 2025 compared to fiscal 2024, negatively impacting revenue growth by about 80 basis points for the year.
Company Guidance
During the Cintas Corporation's fiscal 2025 third-quarter earnings call, the company reported a robust set of financial metrics, showcasing strong performance and operational excellence. Total revenue for the third quarter increased by 8.4% to $2.61 billion, with an organic growth rate of 7.9%. The company achieved an all-time high gross margin of 50.6%, up 11.1% from the previous year. Operating income rose by 17.1% to 23.4% of revenue, also marking an all-time high. Excluding a $15 million gain from a property sale, the operating margin was 22.8%, the second highest in Cintas history. Diluted EPS grew by 17.7% to $1.13. The company experienced strong growth across its business segments, including a 7% organic growth in uniform rental and facility services and double-digit growth in first aid and safety services as well as fire protection services. Cintas updated its annual revenue guidance to a range of $10.28 billion to $10.305 billion and raised its annual diluted EPS expectations to between $4.36 and $4.40, reflecting a growth rate of 15% to 16.1%. The company emphasized its focus on operational efficiencies, sourcing initiatives, and technology investments, such as leveraging its SAP system and SmartTruck technology to enhance margins and customer experience.Cintas Corporate Events
Executive/Board Changes
Cintas Announces CFO Transition Effective June 2025
Neutral
Apr 4, 2025
On April 4, 2025, Cintas Corporation announced the retirement of J. Michael Hansen from his role as Executive Vice President & Chief Financial Officer, effective May 31, 2025. Hansen will transition to a new role as Assistant to the CEO, supporting strategic initiatives and the transition to his successor, Scott Garula. Garula, who joined Cintas in 1996 and has held various leadership roles, will assume the position of Executive Vice President & CFO on June 1, 2025. His appointment is part of a planned succession process, and he is expected to continue Cintas’ financial strategy aimed at growth and shareholder value creation.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.