Cintas' Q2 Earnings & Revenues Surpass Estimates, EPS View Up

Cintas Corporation CTAS reported second-quarter fiscal 2025 (ended Nov. 30, 2024) earnings of $1.09 per share, which beat the Zacks Consensus Estimate of $1.01. The bottom line increased 21.1% year over year despite an increase in operating costs.Total revenues of $2.562 billion marginally outperformed the consensus estimate of $2.56 billion. The top line rose 7.8% year over year, driven by higher segmental revenues. Organic sales were up 7.1% year over year.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Cintas’ Segmental ResultsThe company has two reportable segments, Uniform Rental and Facility Services and First Aid and Safety Services. Other businesses like Uniform Direct Sale and Fire Protection Services are included in All Other. Quarterly sales data is briefly discussed below.Revenues from the Uniform Rental and Facility Services segment (representing 77.7% of the quarter’s net sales) totaled $2 billion, up 7.6% year over year. Our estimate for segmental revenues was $2 billion.Revenues from the First Aid and Safety Services segment (representing 11.7% of the quarter’s net sales) totaled $299.4 million, up 12.4% year over year. Our estimate for segmental revenues was $298.2 million.Revenues from All Other business (representing 10.6% of the quarter’s net sales) totaled $272 million, up 4.5% year over year. Our estimate for segmental revenues was $283.4 million.Cintas Corporation Price, Consensus and EPS Surprise Cintas Corporation price-consensus-eps-surprise-chart | Cintas Corporation QuoteCTAS’ Margin ProfileCintas’ cost of sales (comprising costs related to uniform rental and facility services and others) increased 4% year over year to $1.3 billion. It represented approximately 50.2% of net sales. Gross profit increased 12.3% to $1.28 billion. The gross margin was 49.8% compared with 48% in the year-ago period. Our estimate for the gross margin was pegged at 49.6%.Selling and administrative expenses totaled $685.3 million, reflecting a 6.8% increase from the year-ago figure. It represented 26.8% of net sales. Operating income increased 18.4% year over year to $591.4 million. The operating margin was 23.1% compared with 21% in the year-ago quarter. Interest expenses increased 0.3% to $26.7 million.Cintas’ Balance Sheet & Cash FlowExiting second-quarter fiscal 2025, Cintas had cash and cash equivalents of $122.4 million compared with $342 million at the end of the year-ago fiscal year. Long-term debt was about $2.03 billion, in line with the prior fiscal year’s number.In the first six months of fiscal 2025, CTAS generated net cash of $908.1 million from operating activities, up 24.5% from the year-ago period. Capital expenditures in the same period totaled $194.3 million, down 3.1% year over year. Free cash flow increased 34.9% year over year to $713.8 million.The company repurchased shares worth $651.5 million compared with $423.1 million in the year-ago period. Dividend payments totaled $295.6 million, up 15.5% year over year.CTAS’ FY25 GuidanceFor fiscal 2025, Cintas expects revenues to be in the range of $10.255-$10.32 billion, higher than the earlier predicted band of $10.22-$10.32 billion. The mid-point of the guided range — $10.29 billion — is higher than the Zacks Consensus Estimate of $10.28 billion. Earnings per share (EPS) are estimated to be in the range of $4.28-$4.34 compared with $4.17-$4.25 guided earlier. The mid-point of the guided range — $4.31 — lies above the consensus estimate of $4.23.Cintas predicts net interest expenses of approximately $101 million. This compares with interest expenses of $95 million recorded in fiscal 2024. The effective tax rate is expected to be 20.2% compared with 20.4% reported in fiscal 2024.Other Stocks to ConsiderCintas currently carries a Zacks Rank #2 (Hold). Other top-ranked companies are discussed below:Graham Corporation GHM currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.GHM delivered a trailing four-quarter average earnings surprise of 101.9%. In the past 60 days, the Zacks Consensus Estimate for Graham’s fiscal 2025 earnings has increased 8.4%.Applied Industrial Technologies AIT presently carries a Zacks Rank #2 (Buy). AIT delivered a trailing four-quarter average earnings surprise of 5%.In the past 60 days, the consensus estimate for AIT’s 2024 earnings has inched up 0.7%.RBC Bearings Incorporated RBC presently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 2.5%.In the past 60 days, the consensus estimate for RBC’s fiscal 2025 earnings has increased 0.5%.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report RBC Bearings Incorporated (RBC): Free Stock Analysis Report Cintas Corporation (CTAS): Free Stock Analysis Report Applied Industrial Technologies, Inc. (AIT): Free Stock Analysis Report Graham Corporation (GHM): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks