Cintas Corporation
Cintas Corporation Fundamental Analysis
Cintas Corporation (CTAS) shows moderate financial fundamentals with a PE ratio of 41.92, profit margin of 17.58%, and ROE of 41.07%. The company generates $10.8B in annual revenue with moderate year-over-year growth of 8.86%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 70.0/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze CTAS's fundamental strength across five key dimensions:
Efficiency Score
ExcellentCTAS demonstrates superior asset utilization.
Valuation Score
WeakCTAS trades at a premium to fair value.
Growth Score
ExcellentCTAS delivers strong and consistent growth momentum.
Financial Health Score
ExcellentCTAS maintains a strong and stable balance sheet.
Profitability Score
ExcellentCTAS achieves industry-leading margins.
Key Financial Metrics
Is CTAS Expensive or Cheap?
P/E Ratio
CTAS trades at 41.92 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, CTAS's PEG of 15.97 indicates potential overvaluation.
Price to Book
The market values Cintas Corporation at 17.86 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 26.75 times EBITDA. This signals the market has high growth expectations.
How Well Does CTAS Make Money?
Net Profit Margin
For every $100 in sales, Cintas Corporation keeps $17.58 as profit after all expenses.
Operating Margin
Core operations generate 22.98 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $41.07 in profit for every $100 of shareholder equity.
ROA
Cintas Corporation generates $18.73 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Cintas Corporation produces operating cash flow of $2.21B, showing steady but balanced cash generation.
Free Cash Flow
Cintas Corporation generates strong free cash flow of $1.78B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $4.44 in free cash annually.
FCF Yield
CTAS converts 2.23% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
41.92
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
15.97
vs 25 benchmark
P/B Ratio
Price to book value ratio
17.86
vs 25 benchmark
P/S Ratio
Price to sales ratio
7.38
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.73
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.71
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.41
vs 25 benchmark
ROA
Return on assets percentage
0.19
vs 25 benchmark
ROCE
Return on capital employed
0.31
vs 25 benchmark
How CTAS Stacks Against Its Sector Peers
| Metric | CTAS Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 41.92 | 26.49 | Worse (Expensive) |
| ROE | 41.07% | 1307.00% | Weak |
| Net Margin | 17.58% | -5131.00% (disorted) | Strong |
| Debt/Equity | 0.73 | 0.81 | Neutral |
| Current Ratio | 1.71 | 10.48 | Neutral |
| ROA | 18.73% | -1549793.00% (disorted) | Strong |
CTAS outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Cintas Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
45.30%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
85.32%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
103.24%
Industry Style: Cyclical, Value, Infrastructure
High Growth