UniFirst Corporation (UNF) reported robust fiscal first-quarter results on January 3, which included an enhanced guidance for fiscal 2013 that led all earnings estimates higher. Furthermore, shares of this uniforms supplier reached a 52-week high on the same day of the report.
Overall, this Zacks Rank #1 (Strong Buy) can boast solid top-line growth, improved operating margins and a healthy balance sheet position. It has gained a solid 41.7% since June 26, 2012.
Solid Q1, Guidance Raised
UniFirst reported fiscal first-quarter earnings per share of $1.54, beating the Zacks Consensus Estimate by 15.8% and the year-ago result by 18.5%.
Total revenue of $332.6 million increased 6.3% from last year's $313.0 million and surpassed the Zacks Consensus Estimate of $327.0 million.
Solid revenue helped operating income surge 18.0% year over year to $50.0 million. Operating margin for the period expanded 150 basis points to 15.0%.
Bolstered by the solid results, the company raised its sales and earnings projections for fiscal 2013. The company now expects sales between $1.335 and $1.348 billion, versus the previous outlook of $1.325 billion to $1.338 billion. Earnings per share are now expected at $5.10 to $5.25, instead of $4.65 to $4.85.
Earnings Estimates Surge
The Zacks Consensus Estimate for fiscal 2013 has risen 7.9% in just the past 7 days to $5.20 per share, as all 6 estimates were revised upward. This represents year-over-year growth of 14.2%.
The Zacks Consensus Estimate for fiscal 2014 advanced 5.4% to $5.50 over the same time frame, as 6 of 7 estimates moved higher. This suggests a year-over-year increase of 5.8%.
UniFirst currently trades at a forward P/E of 15.7x, on par with the peer group average. On a price-to-book basis, shares are trading at 1.7x, a 5.6% discount to the peer group average of 1.8x.The trailing 12-month ROE of 10.8% also remains on par with the peer group.
Nevertheless, the company's compelling fundamentals are well supported by its long-term estimated EPS growth rate of 11.5%, compared with 10.8% growth estimated for the peer group.
Shares of UniFirst have gained a robust 41.7% since June 26, 2012. Moreover, UniFirst has continually traded above the 200-day moving average over the past year. The stock is also trading above its 50-day moving average since September 6, 2012. Additionally, the company has outperformed the S&P 500 Index since October 17, 2012. Volume averages roughly 54K daily.
UniFirst Corporation is a leading supplier of uniforms, workwear and protective clothing to businesses throughout the U.S. and Canada. The company provides a wide range of apparel from traditional uniforms, industrial wear, specialty and protective clothing to corporate casual and executive attire. The company also offers floor care and restroom services products, including a range of mats, mops, soaps, air fresheners, and paper items. UniFirst has a market cap of 1.63 billion.
Want More of Our Best Recommendations?
Zacks' Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Then each week he hand-selects the most compelling trades and serves them up to you in a new program called Zacks Confidential.
More From Zacks.com
- Investment & Company Information