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Cintas Corp (CTAS)
NASDAQ:CTAS
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Cintas
(NASDAQ:CTAS)
78Outperform
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
Fire Business Margins
Margins likely pressured in the Fire business on higher IT costs.
Macroeconomic Conditions
Potential headwinds could include revenue growth/operating leverage gains likely slowing modestly amid choppier macro.
Valuation Concerns
Shares trade at an enterprise value of 27 times the fiscal 2026 adjusted EBITDA, above the historical average range.
Cintas (CTAS) vs. S&P 500 (SPY)
Market Cap
$82.67B
Dividend Yield0.73%
Average Volume (3M)1.89M
Price to Earnings (P/E)47.5
Beta (1Y)0.94
Revenue Growth7.79%
EPS Growth19.21%
CountryUS
Employees46,500
SectorIndustrials
Sector Strength68
IndustrySpecialty Business Services
Share Statistics
EPS (TTM)4.31
Shares Outstanding403,543,950
10 Day Avg. Volume2,184,499
30 Day Avg. Volume1,885,543
Financial Highlights & Ratios
PEG Ratio2.49
Price to Book (P/B)N/A
Price to Sales (P/S)7.76
Price to Cash Flow (P/CF)43.70
P/FCF Ratio43.70
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$214.56Price Target Upside12.73% Upside
Rating ConsensusHold
Number of Analyst Covering11
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 Financial Statement Overview
Summary
Cintas is showcasing strong financial performance with substantial revenue and profit growth, supported by efficient cost management and cash generation. The company maintains a robust balance sheet with low leverage, although reduced liquidity could be a concern. Overall, Cintas is in a strong financial position, poised for continued growth in the corporate services industry.Income Statement
Cintas has demonstrated strong revenue growth, with a 12.76% increase in total revenue from 2023 to TTM (Trailing-Twelve-Months). Gross profit margin remains robust at 49.13%, indicating efficient cost management. Net profit margin is also solid at 17.23%. However, the EBITDA margin slightly decreased from 26.30% in 2023 to 24.75% in TTM, showing a small dip in operational efficiency.85
Very Positive
Balance Sheet
The company's balance sheet shows a healthy equity ratio of 49.87% in TTM, suggesting a strong financial foundation. The debt-to-equity ratio is 0.19, reflecting low leverage and reduced financial risk. Return on equity is impressive at 39.88%, showcasing efficient use of equity. However, the decrease in cash reserves from $342 million in 2023 to $122 million in TTM presents a liquidity concern.78
Positive
Cash Flow
Cintas has achieved a significant 46.45% growth in free cash flow from 2023 to TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio is favorable at 1.32, highlighting effective conversion of earnings into cash. However, a decrease in cash reserves may affect short-term liquidity management.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 |
| 2.70B | 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 |
| 664.37M | 2.67B | 2.67B | 2.97B | 2.72B | 2.71B | Net Debt |
| 420.94M | 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
Negative
190.33
Price Trends
201.23
Negative
203.36
Negative
199.36
Negative
Market Momentum
0.95
Negative
60.37
Neutral
68.59
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CTAS, the sentiment is Negative. The current price of 190.33 is below the 20-day moving average (MA) of 198.14, below the 50-day MA of 201.23, and below the 200-day MA of 199.36, indicating a bearish trend. The MACD of 0.95 indicates Negative momentum. The RSI at 60.37 is Neutral, neither overbought nor oversold. The STOCH value of 68.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $82.67B | 47.53 | 40.15% | 0.73% | 7.79% | 19.21% | |
73 Outperform | $3.07B | 21.40 | 7.17% | 0.83% | 6.74% | 31.05% | |
71 Outperform | $11.09B | 29.29 | 7.44% | 2.45% | 3.96% | -17.48% | |
69 Neutral | $3.97B | 66.43 | 3.19% | ― | 13.97% | -54.48% | |
66 Neutral | $2.90B | 36.70 | 4.46% | 2.07% | 2.81% | -67.57% | |
62 Neutral | $8.08B | 13.63 | 3.82% | 3.13% | 3.58% | -14.35% | |
60 Neutral | $9.02B | 26.79 | 11.46% | 1.27% | -5.98% | -46.55% |
* Industrials Sector Average
Performance Comparison
CTAS
Cintas
190.33
22.27
13.25%
ABM
ABM Industries
45.32
1.96
4.52%
CBZ
CBIZ
72.20
-5.00
-6.48%
UNF
UniFirst
163.41
0.11
0.07%
ARMK
ARAMARK Holdings
31.36
-0.82
-2.55%
RTO
Rentokil Initial
20.91
-7.69
-26.89%
Cintas Earnings Call Summary
Earnings Call Date: Mar 26, 2025 | % Change Since: -1.62% | 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.Highlights
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%.
Lowlights
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 ChangesShareholder Meetings
Cintas Shareholders Approve Plan Extension at 2024 Meeting
Neutral
Nov 1, 2024
At its 2024 Annual Meeting, Cintas Corporation’s shareholders approved the extension of their 2016 Equity and Incentive Compensation Plan to 2034 without increasing the stock issuance limit. Directors were elected, executive compensation was backed, and Ernst & Young LLP was ratified as the accounting firm for fiscal 2025. However, proposals on diversity metrics, climate risk management, and political disclosure were not approved.
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.