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Cintas (CTAS) Stock Gains 14% in 3 Months: What's Driving It?

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  • CTAS
  • WBT

Shares of Cintas Corporation CTAS have jumped an impressive 13.5% in the past three months. Sound financial performance, healthy growth opportunities and sound shareholders friendly policies have added to CTAS’ attractiveness. It presently carries a Zacks Rank #2 (Buy).

Cintas provides multiple services to various businesses across North America. Products supplied include entrance mats, first aid and safety products, promotional products, restroom supplies, and others. The company is based in Cincinnati, OH, and has a market capitalization of $45.9 billion.

The company belongs to the Zacks Uniform and Related industry, which comes under the ambit of the Zacks Industrial Products sector. In the past three months, the industry has gained 11.5%. During the same timeframe, the S&P 500 has gained 4.7% and the sector has inched up 0.5%.

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Zacks Investment Research

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Factors Influencing the Stock

Cintas reported impressive results in the first quarter of fiscal 2022 (ended Aug 31, 2021). The company’s earnings surpassed the Zacks Consensus Estimate by 12.68% and sales exceeded the same by 1.51%. On a year-over-year basis, the bottom line expanded 11.9% on higher sales generation, partially offset by an increase in costs and expenses.

Besides sound financial performance, strengthening uniform direct sales, first aid cabinet service, and fire protection services businesses have added to Cintas’ growth opportunities. Also, solid demand for personal protective equipment is beneficial for CTAS’ business in the healthcare and hygiene end markets. Focus on technological advancement, cost control and pricing actions, operational execution and debt reduction are other tailwinds.

For fiscal 2022 (ending May 2022), Cintas anticipates revenues to be $7.58-$7.67 billion, implying year-over-year increase of 7.2% (at the mid-point) from the previous year. Earnings per share are predicted to be $10.60-$10.90, suggesting growth of 5% (at the mid-point) year over year.

Cintas’ commitment toward returning values to shareholders via dividend payouts and share buybacks raises its appeal. Regarding dividends, the company is due to pay quarterly dividend of 95 cents per share in December.

The Zacks Consensus Estimate for Cintas’ earnings per share is pegged at $10.85 for fiscal 2022 and $12.05 for fiscal 2023 (ending May 2023), marking growth of 2.3% and 2% from the respective 60-day-ago figures. Such upward revisions in earnings estimates reflect healthy operating conditions for the company.

Cintas Corporation Price and Consensus

Cintas Corporation Price and Consensus
Cintas Corporation Price and Consensus

Cintas Corporation price-consensus-chart | Cintas Corporation Quote

Other Stocks to Consider

Three other top-ranked stocks from the sector with their past three months’ price performance are discussed below.

Applied Industrial Technologies, Inc.’s AIT shares have gained 19.3% in the past three months. AIT’s results in the last quarter were better than expected, with earnings surpassing estimates by 14.29%.

In the past 60 days, the Zacks Consensus Estimate for Applied Industrial’s earnings has increased 1.9% for fiscal 2022 (ending June 2022) and 2.2% for fiscal 2023 (ending June 2023). AIT presently carries a Zacks Rank #2.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Energy Recovery, Inc. ERII performed well in the past three months, with shares rising 21.6%. ERII’s earnings in the last reported quarter surpassed estimates by 2 cents.

In the past 60 days, the Zacks Consensus Estimate for Energy Recovery’s earnings has increased 18.2% for 2021 and 39.3% for 2022. The company presently carries a Zacks Rank #2.

Welbilt, Inc.’s WBT shares have gained 1.1% in the past three months. WBT’s results in the last quarter were better than expected, with earnings surpassing estimates by 40.00%.

In the past 60 days, the Zacks Consensus Estimate for Welbilt’s earnings has increased 3.2% for 2021 and 5.9% for 2022. WBT presently carries a Zacks Rank #2.


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Cintas Corporation (CTAS) : Free Stock Analysis Report

Applied Industrial Technologies, Inc. (AIT) : Free Stock Analysis Report

Energy Recovery, Inc. (ERII) : Free Stock Analysis Report

Welbilt, Inc. (WBT) : Free Stock Analysis Report

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