Cintas Corporation (CTAS - Free Report) stands to gain from strength across its healthcare and hygiene end markets, driven by strong demand for its personal protective equipment like face masks, gloves, sanitizers and other critical items. Also, the company’s focus on enhancement of the product portfolio and customer base along with its strong supply chain, distribution network and sales force is likely to be advantageous. For the fourth quarter of fiscal 2021 (ended May 2021, results are awaited), it expects revenues of $1.80-$1.83 billion, indicating growth of 2.1% on a sequential basis.
Also, the company focuses on expanding its market share, product offerings and customer base through acquisitions. Its acquisition of Doritex Corp. (February 2020) has strengthened its offerings and customer reach across Buffalo and the surrounding Western New York region. It invested $53.7 million in acquisitions in fiscal 2020 (ended May 2020) and $7.6 million in the first nine months of fiscal 2021.
Moreover, it remains committed to rewarding shareholders handsomely through dividend payments and share buybacks. In the first nine months of fiscal 2021, the company used $371.8 million for paying out dividends and repurchasing shares worth $154.5 million. Also, it hiked its annual dividend rate by 10.2% in October 2020. Notably, it changed its dividend payment policy from annual to quarterly.
However, persistent weakness across the airline, cruise line, hospitality and gaming end markets on account of the coronavirus-led issues might affect Cintas’ top-line performance in the near term.
In addition, the company’s high-debt profile poses a concern. In the last five fiscal years (2016-2020), its long-term debt rose 19.5% (CAGR). Notably, the metric remained high at $2,291.4 million at the end of the third quarter of fiscal 2021 (ended February 2021). Any further increase in debt levels can raise the company’s financial obligations.
In the past three months, this Zacks Rank #3 (Hold) stock has returned 4.2% compared with the industry’s growth of 2.5%.
Key Picks
Some better-ranked stocks from the Zacks Industrial Products sector are Alcoa Corporation (AA - Free Report) , AGCO Corporation (AGCO - Free Report) and Avery Dennison Corporation (AVY - Free Report) . While Alcoa sports a Zacks Rank #1 (Strong Buy), AGCO and Avery Dennison carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Alcoa delivered an earnings surprise of 64.58% in the last reported quarter.
AGCO delivered an earnings surprise of 80.18% in the last reported quarter.
Avery Dennison delivered an earnings surprise of 19.40% in the last reported quarter.
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From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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Cintas Corporation (CTAS - Free Report) stands to gain from strength across its healthcare and hygiene end markets, driven by strong demand for its personal protective equipment like face masks, gloves, sanitizers and other critical items. Also, the company’s focus on enhancement of the product portfolio and customer base along with its strong supply chain, distribution network and sales force is likely to be advantageous. For the fourth quarter of fiscal 2021 (ended May 2021, results are awaited), it expects revenues of $1.80-$1.83 billion, indicating growth of 2.1% on a sequential basis.
Also, the company focuses on expanding its market share, product offerings and customer base through acquisitions. Its acquisition of Doritex Corp. (February 2020) has strengthened its offerings and customer reach across Buffalo and the surrounding Western New York region. It invested $53.7 million in acquisitions in fiscal 2020 (ended May 2020) and $7.6 million in the first nine months of fiscal 2021.
Moreover, it remains committed to rewarding shareholders handsomely through dividend payments and share buybacks. In the first nine months of fiscal 2021, the company used $371.8 million for paying out dividends and repurchasing shares worth $154.5 million. Also, it hiked its annual dividend rate by 10.2% in October 2020. Notably, it changed its dividend payment policy from annual to quarterly.
However, persistent weakness across the airline, cruise line, hospitality and gaming end markets on account of the coronavirus-led issues might affect Cintas’ top-line performance in the near term.
In addition, the company’s high-debt profile poses a concern. In the last five fiscal years (2016-2020), its long-term debt rose 19.5% (CAGR). Notably, the metric remained high at $2,291.4 million at the end of the third quarter of fiscal 2021 (ended February 2021). Any further increase in debt levels can raise the company’s financial obligations.
In the past three months, this Zacks Rank #3 (Hold) stock has returned 4.2% compared with the industry’s growth of 2.5%.
Key Picks
Some better-ranked stocks from the Zacks Industrial Products sector are Alcoa Corporation (AA - Free Report) , AGCO Corporation (AGCO - Free Report) and Avery Dennison Corporation (AVY - Free Report) . While Alcoa sports a Zacks Rank #1 (Strong Buy), AGCO and Avery Dennison carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Alcoa delivered an earnings surprise of 64.58% in the last reported quarter.
AGCO delivered an earnings surprise of 80.18% in the last reported quarter.
Avery Dennison delivered an earnings surprise of 19.40% in the last reported quarter.
Zacks' Top Picks to Cash in on Artificial Intelligence
In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.
See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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