UniFirst (UNF) AI Stock Analysis

• Market Cap: $3.11B
• Dividend Yield: 0.79%
• Average Volume (3M): 141.34K
• Price to Earnings (P/E): 21.6
• Beta (1Y): 0.61
• Revenue Growth: 4.18%
• EPS Growth: 18.93%
• Country: US
• Employees: 16,000
• Sector: Industrials
• Sector Strength: 93
• Industry: Specialty Business Services
• EPS (TTM): 2.17
• Shares Outstanding: 14,991,657
• 10 Day Avg. Volume: 119,040
• 30 Day Avg. Volume: 141,342
• PEG Ratio: 17.11
• Price to Book (P/B): 1.42
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 16.83
• Enterprise Value/Market Cap: 0.95
• Enterprise Value/Revenue: 0.30
• Enterprise Value/Gross Profit: 3.48
• Enterprise Value/Ebitda: 2.24
• 1Y Price Target: $178.25
• Price Target Upside: 2.80% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 5

• Rating: 61 Neutral
• Price Target: $180.00 ▲(3.81%Upside)

UniFirst's robust financial performance is the primary strength, indicating solid profitability and a stable balance sheet. However, the stock's bearish technical indicators and mixed earnings call sentiment present notable risks. Valuation is moderate, providing a balanced perspective on its market position.

Positive Factors

Earnings

Adjusted EPS increased 14%, to $1.40, above the consensus estimate.

Financial Performance

Better-than-expected operating performance in the core laundry business is expected to continue.

Negative Factors

Market Environment

There is a less positive outlook on the broader operating environment for the company based on certain KPI commentary and the potential for latent impacts from tariffs.

Revenue

Management reduced its top-line outlook by $5.5 million at the midpoint.

UniFirst Business Overview & Revenue Model

Company Description

UniFirst Corporation provides workplace uniforms and protective work wear clothing in the United States, Europe, and Canada. The company operates through U.S. and Canadian Rental and Cleaning, Manufacturing, Specialty Garments Rental and Cleaning, and First Aid segments. It designs, manufactures, personalizes, rents, cleans, delivers, and sells a range of uniforms and protective clothing, including shirts, pants, jackets, coveralls, lab coats, smocks, and aprons; and specialized protective wear, such as flame resistant and high visibility garments. The company also rents and sells industrial wiping products, floor mats, facility service products, and dry and wet mops; restroom and cleaning supplies comprising air fresheners, paper products, gloves, masks, sanitizers, and hand soaps; and other textile products. In addition, it provides first aid cabinet services and other safety supplies; decontaminates and cleans work clothes, and other items that is exposed to radioactive materials; and services special cleanroom protective wear and facilities. Further, it offers a range of garment service options, including full-service rental programs in which garments are cleaned and serviced; lease programs in which garments are cleaned and maintained by individual employees; and purchase programs to buy garments and related items directly. The company serves automobile service centers and dealers, delivery services, food and general merchandise retailers, food processors and service operations, light manufacturers, maintenance facilities, restaurants, service companies, soft and durable goods wholesalers, transportation companies, healthcare providers, government agencies, research and development laboratories, high technology companies, and utilities operating nuclear reactors, as well as others who require employee clothing for image, identification, protection, or utility purposes. UniFirst Corporation was founded in 1936 and is headquartered in Wilmington, Massachusetts.

How the Company Makes Money

UniFirst generates revenue primarily through its uniform rental and facility service programs. The company enters into long-term contracts with businesses, providing them with a consistent supply of clean, well-maintained uniforms and facility service products. Revenue is earned on a recurring basis, as customers pay for the rental, laundering, and maintenance of uniforms. In addition to rental services, UniFirst also sells uniforms and related products directly to customers, offering a purchase option alongside its rental solutions. The company benefits from its expansive service network and distribution capabilities, allowing it to efficiently manage inventory and logistics. Strategic partnerships and acquisitions further enhance UniFirst's market presence and expand its customer base, contributing to its overall earnings.

UniFirst Financial Statement Overview

Summary

UniFirst showcases a robust financial performance with sustained revenue and profit growth, strong margins, and a stable balance sheet. Low leverage and efficient cash flow management further strengthen its financial health. The company is well-positioned in the Specialty Business Services industry, with opportunities for further growth and profitability improvement.

Income Statement

The income statement reflects strong growth with a consistent increase in revenue and net income over the years. The TTM data shows a gross profit margin of 34.6% and a net profit margin of 6.2%, indicating solid profitability. The revenue growth rate from the previous annual report is 1.25%, while the EBIT margin stands at 7.7% and the EBITDA margin at 13.8%. These figures highlight a robust financial position with stable profitability trends.

Balance Sheet

UniFirst maintains a healthy balance sheet with a low debt-to-equity ratio of 0.034 and a strong equity ratio of 78.8%, indicating low leverage and high stability. Return on equity is 7.0%, reflecting efficient use of equity to generate profits. The company's financial position is strong, though slightly lower ROE suggests room for improvement in asset utilization.

Cash Flow

The cash flow statement reveals positive trends with a strong operating cash flow to net income ratio of 1.97, indicating efficient cash generation from operations. Free cash flow has grown significantly, demonstrating a 36.42% growth from the previous period. The free cash flow to net income ratio is 1.21, which underscores the company's ability to generate cash above its net income, supporting growth and stability.

Breakdown	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	2.43B	2.23B	2.00B	1.83B	1.80B
Gross Profit	847.60M	751.75M	694.37M	684.94M	639.23M
EBITDA	325.01M	262.03M	244.10M	302.76M	278.36M
Net Income	145.47M	103.67M	103.40M	151.11M	135.77M
Balance Sheet
Total Assets	2.70B	2.57B	2.43B	2.38B	2.20B
Cash, Cash Equivalents and Short-Term Investments	175.08M	89.60M	376.40M	512.87M	474.84M
Total Debt	68.81M	64.76M	51.67M	43.17M	41.83M
Total Liabilities	587.90M	566.01M	512.10M	508.11M	457.90M
Stockholders Equity	2.11B	2.00B	1.92B	1.87B	1.74B
Cash Flow
Free Cash Flow	134.85M	43.77M	-21.67M	78.66M	169.97M
Operating Cash Flow	295.27M	215.76M	122.65M	212.30M	286.68M
Investing Cash Flow	-162.24M	-487.65M	-186.51M	-141.47M	-157.62M
Financing Cash Flow	-50.36M	-25.84M	-69.44M	-34.26M	-41.10M

UniFirst Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 173.40
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UNF, the sentiment is Negative. The current price of 173.4 is below the 20-day moving average (MA) of 176.32, below the 50-day MA of 182.48, and below the 200-day MA of 191.19, indicating a bearish trend. The MACD of -2.32 indicates Negative momentum. The RSI at 42.42 is Neutral, neither overbought nor oversold. The STOCH value of 31.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for UNF.

UniFirst Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CTAS	76 Outperform	$90.00B	50.65	40.16%	0.96%	7.75%	16.31%
ABM	75 Outperform	$2.96B	38.04	4.30%	2.14%	3.52%	-67.27%
CBZ	74 Outperform	$4.16B	52.93	6.25%	―	32.27%	-40.50%
ARMK	71 Outperform	$11.37B	33.98	11.77%	0.94%	-3.47%	-45.03%
BV	66 Neutral	$1.55B	85.78	2.56%	―	-2.85%	-108.99%
Sector *	61 Neutral	C$6.54B	7.73	2.76%	2.57%	6.48%	-23.55%
UNF	61 Neutral	$3.11B	21.62	7.15%	0.79%	4.18%	18.93%