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Here's Why You Should Consider Investing in Cintas Right Now
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Key Takeaways
CTAS sees solid segment momentum, led by new customer gains and strong product penetration.
Acquisitions like Paris Uniform and SITEX boosted CTAS' regional presence and service capabilities.
CTAS raised its dividend by 15.6% and repurchased $678.1M in shares in the first nine months of fiscal 2025.
Cintas Corporation (CTAS - Free Report) is poised to gain from strong segmental performance, investments in technology and accretive acquisitions. Handsome rewards to shareholders add to the stock’s appeal.
Based in Cincinnati, OH, Cintas provides specialized services to businesses of all types throughout North America. The company provides entrance mats, restroom supplies, promotional products and first aid and safety products for diversified businesses. In the past year, shares of this Zacks Rank #2 (Buy) company have gained 33.1% compared with the industry’s 17.2% growth.
Image Source: Zacks Investment Research
Let’s delve into the factors that make this company a smart investment choice at the moment.
Business Strength: Solid momentum across all segments is driving Cintas’ top line. Strong growth from new customers and penetration of additional products & services into existing customers are supporting the performance of the Uniform Rental and Facility Services segment. First Aid and Safety Services segment is riding on the back of increasing demand for AED Rentals, eyewash stations and WaterBreak products. An improved sales mix also bodes well for the segment. Driven by strength across its businesses, Cintas has provided a bullish forecast for fiscal 2025. The company expects organic revenues to increase 7.7% on a year-over-year basis.
Expansion Efforts: Cintas is focused on strengthening its competency through acquisitions. In March 2024, the company acquired Paris Uniform Services, a family-owned supplier of uniform and facility service solutions. The buyout enhanced CTAS’ market presence in Pennsylvania, New York, Maryland and West Virginia. In February 2024, the company acquired SITEX, which strengthened its market position in the central Midwest region of the United States. Cintas acquired businesses for $198.8 million in the first nine months of fiscal 2025 (ended February 2025).
Product Enhancement Efforts: The company's focus on the enhancement of its product portfolio, along with investments in technology and existing facilities, should continue to drive its performance. For instance, its investment in SmartTruck technology continues to provide route optimization and improved efficiencies. Also, CTAS has been investing in garment-sharing technology and SAP systems for a while now. In addition, Cintas has partnered with Verizon and Google to deploy technology solutions providing its employees with the insights necessary to deliver a more personalized customer experience.
Shareholder-Friendly Policies: The company consistently returned significant cash to its shareholders through dividends and share repurchases. In the first nine months of fiscal 2025, CTAS paid dividends worth $453.7 million, up 14.4% year over year. The amount spent on share buybacks totaled $678.1 million in the same period compared with $468.1 million in the year-ago period. The company hiked its quarterly dividend by 15.6% to $1.56 per share in July 2024. Cintas has consistently raised its dividends for 40 straight years. It’s worth noting that in the first nine months of fiscal 2025, it generated a solid operating cash flow of $1.53 billion, reflecting an increase of 10.3% year over year.
HCGS delivered a trailing four-quarter average earnings surprise of 8%. In the past 60 days, the Zacks Consensus Estimate for Healthcare Services’ 2025 earnings has increased 5%.
UL Solutions Inc. (ULS - Free Report) presently sports a Zacks Rank of 1. The company delivered a trailing four-quarter average earnings surprise of 23.2%.
In the past 60 days, the consensus estimate for ULS’ 2025 earnings has increased 4.1%.
ABM Industries Incorporated (ABM - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 6.4%.
The Zacks Consensus Estimate for ABM’s 2025 earnings has remained steady in the past 60 days.
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Here's Why You Should Consider Investing in Cintas Right Now
Key Takeaways
Cintas Corporation (CTAS - Free Report) is poised to gain from strong segmental performance, investments in technology and accretive acquisitions. Handsome rewards to shareholders add to the stock’s appeal.
Based in Cincinnati, OH, Cintas provides specialized services to businesses of all types throughout North America. The company provides entrance mats, restroom supplies, promotional products and first aid and safety products for diversified businesses. In the past year, shares of this Zacks Rank #2 (Buy) company have gained 33.1% compared with the industry’s 17.2% growth.
Image Source: Zacks Investment Research
Let’s delve into the factors that make this company a smart investment choice at the moment.
Business Strength: Solid momentum across all segments is driving Cintas’ top line. Strong growth from new customers and penetration of additional products & services into existing customers are supporting the performance of the Uniform Rental and Facility Services segment. First Aid and Safety Services segment is riding on the back of increasing demand for AED Rentals, eyewash stations and WaterBreak products. An improved sales mix also bodes well for the segment. Driven by strength across its businesses, Cintas has provided a bullish forecast for fiscal 2025. The company expects organic revenues to increase 7.7% on a year-over-year basis.
Expansion Efforts: Cintas is focused on strengthening its competency through acquisitions. In March 2024, the company acquired Paris Uniform Services, a family-owned supplier of uniform and facility service solutions. The buyout enhanced CTAS’ market presence in Pennsylvania, New York, Maryland and West Virginia. In February 2024, the company acquired SITEX, which strengthened its market position in the central Midwest region of the United States. Cintas acquired businesses for $198.8 million in the first nine months of fiscal 2025 (ended February 2025).
Product Enhancement Efforts: The company's focus on the enhancement of its product portfolio, along with investments in technology and existing facilities, should continue to drive its performance. For instance, its investment in SmartTruck technology continues to provide route optimization and improved efficiencies. Also, CTAS has been investing in garment-sharing technology and SAP systems for a while now. In addition, Cintas has partnered with Verizon and Google to deploy technology solutions providing its employees with the insights necessary to deliver a more personalized customer experience.
Shareholder-Friendly Policies: The company consistently returned significant cash to its shareholders through dividends and share repurchases. In the first nine months of fiscal 2025, CTAS paid dividends worth $453.7 million, up 14.4% year over year. The amount spent on share buybacks totaled $678.1 million in the same period compared with $468.1 million in the year-ago period. The company hiked its quarterly dividend by 15.6% to $1.56 per share in July 2024. Cintas has consistently raised its dividends for 40 straight years. It’s worth noting that in the first nine months of fiscal 2025, it generated a solid operating cash flow of $1.53 billion, reflecting an increase of 10.3% year over year.
Other Stocks to Consider
Other top-ranked companies are discussed below:
Healthcare Services Group, Inc. (HCSG - Free Report) currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
HCGS delivered a trailing four-quarter average earnings surprise of 8%. In the past 60 days, the Zacks Consensus Estimate for Healthcare Services’ 2025 earnings has increased 5%.
UL Solutions Inc. (ULS - Free Report) presently sports a Zacks Rank of 1. The company delivered a trailing four-quarter average earnings surprise of 23.2%.
In the past 60 days, the consensus estimate for ULS’ 2025 earnings has increased 4.1%.
ABM Industries Incorporated (ABM - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 6.4%.
The Zacks Consensus Estimate for ABM’s 2025 earnings has remained steady in the past 60 days.