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UniFirst Reported Mixed Quarterly Results for Fiscal 1Q16

Gabriel Kane

LULU, CRI, and STZ Led the Consumer Sector at the Start of 2016

(Continued from Prior Part)

Price movement of UniFirst

UniFirst (UNF) rose by 0.60% to close at $102.26 per share as of January 6, 2016. Its price movements on a weekly, monthly, and year-to-date (or YTD) basis are -3.5%, -5.4%, and -3.5%, respectively.

Currently, UNF is trading 3.4% below its 20-day moving average, 4.9% below its 50-day moving average, and 9.7% below its 200-day moving average.

The PowerShares S&P SmallCap Low Volatility ETF (XSLV) invests 0.82% of its holdings in UniFirst. The ETF tracks a volatility weighted index of the 120 least-volatile securities from the S&P SmallCap 600 Index.

The SPDR S&P SmallCap 600 Value ETF (SLYV) invests 0.53% of its holdings in UniFirst. The ETF aims to track a market-cap–weighted index of US small-cap value stocks. The index selects from stocks with market capitalizations between $250 million and $1.2 billion.

Competitors of UniFirst and their market capitalizations are as follows:

  • Airgas (ARG) — $9.9 billion
  • Cintas (CTAS) — $9.5 billion
  • Aramark (ARMK) — $7.7 billion

Performance of UniFirst in fiscal 1Q16

UniFirst (UNF) reported fiscal 1Q16 revenue of $373.4 million, a rise of 0.81% when compared to revenue of $370.4 million in fiscal 1Q15. The company’s operating income fell by 3.8% in fiscal 1Q16 compared to the prior year’s period. Its net income and EPS (earnings per share) fell to $35.9 million and $1.78, respectively, in fiscal 1Q16, compared to net income and EPS of $37.4 million and $1.85, respectively, in fiscal 1Q15.

Meanwhile, its cash and cash equivalents rose by 12.6%, and its inventories fell by 4.4% in fiscal 1Q16 on a quarterly basis. Its current ratio fell to 3.56 in fiscal 1Q16 compared to a current ratio of 3.59 in fiscal 4Q15.

UniFirst’s PE (price-to-earnings) and PBV (price-to-book value) ratios are 16.3x and 1.6x, respectively, as of January 8, 2016.

Projections

The company has projected that for fiscal 2016, its revenue will be in the range of $1.46–$1.48 billion. It expects its diluted EPS to be in the range of $5.60–$5.80.

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