CINTAS CORP (CTAS) Stock Fundamental Analysis
NASDAQ:CTAS - Nasdaq - US1729081059 - Common Stock - Currency: USD
CTAS gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 84 industry peers in the Commercial Services & Supplies industry. CTAS has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. While showing a medium growth rate, CTAS is valued expensive at the moment. With these ratings, CTAS could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
CTAS had positive earnings in the past year.
In the past year CTAS had a positive cash flow from operations.
CTAS had positive earnings in each of the past 5 years.
In the past 5 years CTAS always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 18.22%, CTAS belongs to the best of the industry, outperforming 98.78% of the companies in the same industry.
CTAS has a better Return On Equity (39.74%) than 97.56% of its industry peers.
The Return On Invested Capital of CTAS (24.03%) is better than 97.56% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CTAS is significantly above the industry average of 10.12%.
The last Return On Invested Capital (24.03%) for CTAS is above the 3 year average (20.29%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.22% | ||
| ROE | 39.74% | ||
| ROIC | 24.03% |
ROA(3y)15.96%
ROA(5y)14.52%
ROE(3y)36.06%
ROE(5y)32.99%
ROIC(3y)20.29%
ROIC(5y)18.5%
1.3 Margins
The Profit Margin of CTAS (17.16%) is better than 95.12% of its industry peers.
In the last couple of years the Profit Margin of CTAS has grown nicely.
CTAS has a Operating Margin of 22.34%. This is amongst the best in the industry. CTAS outperforms 93.90% of its industry peers.
In the last couple of years the Operating Margin of CTAS has grown nicely.
CTAS has a better Gross Margin (49.62%) than 87.80% of its industry peers.
In the last couple of years the Gross Margin of CTAS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.34% | ||
| PM (TTM) | 17.16% | ||
| GM | 49.62% |
OM growth 3Y3.33%
OM growth 5Y5.29%
PM growth 3Y1.71%
PM growth 5Y5.13%
GM growth 3Y1.59%
GM growth 5Y1.47%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CTAS is creating value.
CTAS has more shares outstanding than it did 1 year ago.
CTAS has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, CTAS has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 13.49 indicates that CTAS is not in any danger for bankruptcy at the moment.
CTAS has a Altman-Z score of 13.49. This is amongst the best in the industry. CTAS outperforms 97.56% of its industry peers.
CTAS has a debt to FCF ratio of 1.43. This is a very positive value and a sign of high solvency as it would only need 1.43 years to pay back of all of its debts.
CTAS has a better Debt to FCF ratio (1.43) than 81.71% of its industry peers.
A Debt/Equity ratio of 0.47 indicates that CTAS is not too dependend on debt financing.
CTAS's Debt to Equity ratio of 0.47 is in line compared to the rest of the industry. CTAS outperforms 52.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.43 | ||
| Altman-Z | 13.49 |
ROIC/WACC2.68
WACC8.97%
2.3 Liquidity
CTAS has a Current Ratio of 1.58. This is a normal value and indicates that CTAS is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.58, CTAS is in line with its industry, outperforming 57.32% of the companies in the same industry.
CTAS has a Quick Ratio of 1.38. This is a normal value and indicates that CTAS is financially healthy and should not expect problems in meeting its short term obligations.
CTAS has a Quick ratio (1.38) which is comparable to the rest of the industry.
The current and quick ratio evaluation for CTAS is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.58 | ||
| Quick Ratio | 1.38 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 20.39% over the past year.
CTAS shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 14.78% yearly.
The Revenue has grown by 8.12% in the past year. This is quite good.
Measured over the past years, CTAS shows a small growth in Revenue. The Revenue has been growing by 6.84% on average per year.
EPS 1Y (TTM)20.39%
EPS 3Y13.92%
EPS 5Y14.78%
EPS Q2Q%20.78%
Revenue 1Y (TTM)8.12%
Revenue growth 3Y10.48%
Revenue growth 5Y6.84%
Sales Q2Q%7.77%
3.2 Future
The Earnings Per Share is expected to grow by 11.48% on average over the next years. This is quite good.
Based on estimates for the next years, CTAS will show a small growth in Revenue. The Revenue will grow by 7.70% on average per year.
EPS Next Y16.51%
EPS Next 2Y13.42%
EPS Next 3Y12.67%
EPS Next 5Y11.48%
Revenue Next Year7.37%
Revenue Next 2Y7.28%
Revenue Next 3Y7.2%
Revenue Next 5Y7.7%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 49.26 indicates a quite expensive valuation of CTAS.
CTAS's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 29.63, CTAS is valued quite expensively.
Based on the Price/Forward Earnings ratio of 41.99, the valuation of CTAS can be described as expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as CTAS.
CTAS's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 22.68.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 49.26 | ||
| Fwd PE | 41.99 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CTAS is valued a bit more expensive than the industry average as 68.29% of the companies are valued more cheaply.
The rest of the industry has a similar Price/Free Cash Flow ratio as CTAS.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 44.47 | ||
| EV/EBITDA | 31.81 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
CTAS has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as CTAS's earnings are expected to grow with 12.67% in the coming years.
PEG (NY)2.98
PEG (5Y)3.33
EPS Next 2Y13.42%
EPS Next 3Y12.67%
5. Dividend
5.1 Amount
With a yearly dividend of 0.76%, CTAS is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 2.12, CTAS pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.76, CTAS pays less dividend than the S&P500 average, which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.76% |
5.2 History
The dividend of CTAS decreases each year by -0.11%.
CTAS has been paying a dividend for at least 10 years, so it has a reliable track record.
CTAS has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-0.11%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
33.44% of the earnings are spent on dividend by CTAS. This is a low number and sustainable payout ratio.
DP33.44%
EPS Next 2Y13.42%
EPS Next 3Y12.67%
204.43
-1.5 (-0.73%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners66.94%
Inst Owner Change4.75%
Ins Owners1.79%
Ins Owner Change0.03%
Market Cap82.50B
Analysts71.2
Price Target205.68 (0.61%)
Short Float %1.23%
Short Ratio2.12
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.76% |
Yearly Dividend2.1
Dividend Growth(5Y)-0.11%
DP33.44%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)9.23%
Min EPS beat(2)5.32%
Max EPS beat(2)13.14%
EPS beat(4)4
Avg EPS beat(4)6.71%
Min EPS beat(4)3.09%
Max EPS beat(4)13.14%
EPS beat(8)7
Avg EPS beat(8)3.81%
EPS beat(12)11
Avg EPS beat(12)4.08%
EPS beat(16)15
Avg EPS beat(16)4.52%
Revenue beat(2)0
Avg Revenue beat(2)-1.87%
Min Revenue beat(2)-2.04%
Max Revenue beat(2)-1.71%
Revenue beat(4)0
Avg Revenue beat(4)-1.68%
Min Revenue beat(4)-2.04%
Max Revenue beat(4)-1.14%
Revenue beat(8)0
Avg Revenue beat(8)-1.21%
Revenue beat(12)4
Avg Revenue beat(12)-0.44%
Revenue beat(16)4
Avg Revenue beat(16)-0.54%
PT rev (1m)-3.23%
PT rev (3m)-3.05%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-75.1%
EPS NY rev (1m)0.11%
EPS NY rev (3m)2.01%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.45%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 49.26 | ||
| Fwd PE | 41.99 | ||
| P/S | 8.3 | ||
| P/FCF | 44.47 | ||
| P/OCF | 36.53 | ||
| P/B | 19.22 | ||
| P/tB | 171.57 | ||
| EV/EBITDA | 31.81 |
EPS(TTM)4.15
EY2.03%
EPS(NY)4.87
Fwd EY2.38%
FCF(TTM)4.6
FCFY2.25%
OCF(TTM)5.6
OCFY2.74%
SpS24.63
BVpS10.64
TBVpS1.19
PEG (NY)2.98
PEG (5Y)3.33
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.22% | ||
| ROE | 39.74% | ||
| ROCE | 30.18% | ||
| ROIC | 24.03% | ||
| ROICexc | 24.44% | ||
| ROICexgc | 51.64% | ||
| OM | 22.34% | ||
| PM (TTM) | 17.16% | ||
| GM | 49.62% | ||
| FCFM | 18.66% |
ROA(3y)15.96%
ROA(5y)14.52%
ROE(3y)36.06%
ROE(5y)32.99%
ROIC(3y)20.29%
ROIC(5y)18.5%
ROICexc(3y)20.86%
ROICexc(5y)19.2%
ROICexgc(3y)43.4%
ROICexgc(5y)41.05%
ROCE(3y)25.49%
ROCE(5y)23.23%
ROICexcg growth 3Y2.7%
ROICexcg growth 5Y9.17%
ROICexc growth 3Y7.28%
ROICexc growth 5Y9.85%
OM growth 3Y3.33%
OM growth 5Y5.29%
PM growth 3Y1.71%
PM growth 5Y5.13%
GM growth 3Y1.59%
GM growth 5Y1.47%
F-Score8
Asset Turnover1.06
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.43 | ||
| Debt/EBITDA | 0.75 | ||
| Cap/Depr | 85.51% | ||
| Cap/Sales | 4.06% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 83.88% | ||
| Profit Quality | 108.72% | ||
| Current Ratio | 1.58 | ||
| Quick Ratio | 1.38 | ||
| Altman-Z | 13.49 |
F-Score8
WACC8.97%
ROIC/WACC2.68
Cap/Depr(3y)77.9%
Cap/Depr(5y)66.29%
Cap/Sales(3y)3.7%
Cap/Sales(5y)3.27%
Profit Quality(3y)102.17%
Profit Quality(5y)107.82%
High Growth Momentum
Growth
EPS 1Y (TTM)20.39%
EPS 3Y13.92%
EPS 5Y14.78%
EPS Q2Q%20.78%
EPS Next Y16.51%
EPS Next 2Y13.42%
EPS Next 3Y12.67%
EPS Next 5Y11.48%
Revenue 1Y (TTM)8.12%
Revenue growth 3Y10.48%
Revenue growth 5Y6.84%
Sales Q2Q%7.77%
Revenue Next Year7.37%
Revenue Next 2Y7.28%
Revenue Next 3Y7.2%
Revenue Next 5Y7.7%
EBIT growth 1Y15.8%
EBIT growth 3Y14.15%
EBIT growth 5Y12.5%
EBIT Next Year37.92%
EBIT Next 3Y18.04%
EBIT Next 5Y14.12%
FCF growth 1Y44.43%
FCF growth 3Y11.13%
FCF growth 5Y16.12%
OCF growth 1Y44.49%
OCF growth 3Y15.19%
OCF growth 5Y14.26%