Stock of the Day

August 10, 2022

Cintas (CTAS)

$204.43
-$1.50 (-0.7%)
Market Cap: $83.10B

About Cintas

Cintas Corporation engages in the provision of 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. In addition, the company offers first aid and safety services, and fire protection products and services. It 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. The company was founded in 1968 and is based in Cincinnati, Ohio. Cintas Corporation was formerly a subsidiary of Cintas Corporation.

Cintas Bull Case

Here are some ways that investors could benefit from investing in Cintas Co.:

  • Cintas Co. recently reported earnings per share (EPS) of $1.09, exceeding analysts' expectations of $1.01, indicating strong financial performance and effective management.
  • The company has shown a revenue increase of 7.8% compared to the same quarter last year, reflecting growth in its business services sector.
  • With a current stock price of $202.56, Cintas Co. is positioned within a range that analysts have set target prices between $200.00 and $215.00, suggesting potential for price appreciation.
  • Cintas Co. has a solid return on equity of 40.62%, which indicates efficient use of shareholders' equity to generate profits.
  • The company maintains a reasonable debt-to-equity ratio of 0.47, suggesting a balanced approach to leveraging debt for growth while minimizing financial risk.

Cintas Bear Case

Investors should be bearish about investing in Cintas Co. for these reasons:

  • Despite recent growth, Cintas Co. has a high price-to-earnings (P/E) ratio of 48.84, which may indicate that the stock is overvalued compared to its earnings.
  • Two analysts have rated the stock with a sell rating, suggesting some skepticism about its future performance.
  • The average target price of $198.46 is slightly below the current stock price, indicating limited upside potential in the near term.
  • Cintas Co. has a relatively low dividend yield of 0.77%, which may not be attractive for income-focused investors.
  • Market volatility, as indicated by a beta of 1.37, suggests that Cintas Co.'s stock price may be more susceptible to fluctuations compared to the overall market.

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