Cintas’ Quarterly Results Beat Analysts’ Expectations; Shares Dip

Cintas Corporation posted better-than-expected fiscal 3Q (ended Feb. 28) results. However, shares of the business services company dipped 1.4% to close at $343.22 on March 17, as the pandemic and severe weather conditions impacted the top-line results on a year-over-year basis.

Cintas (CTAS) reported 3Q earnings of $2.37 per share, up 9.7% on a year-over-year basis, and handily beat the Street estimates of $2.21 per share. Revenue inched down 1.7% to $1.78 billion but topped analysts’ expectations of $1.75 billion.

The organic revenue growth rate for the quarter was flat. Additionally, the uniform rental and facility services operating segment also reported flat growth, while first aid and safety services operating segment revenues surged 17.7%. (See Cintas stock analysis on TipRanks)

Cintas CEO Scott D. Farmer said, “For our fiscal fourth quarter, we expect revenue to be in the range of $1.80 billion to $1.83 billion and diluted EPS to be in the range of $2.20 to $2.40.”

“This financial guidance does not include any future share buybacks or additional restrictions on businesses due to increasing COVID-19 case counts,” Farmer added.

Oppenheimer analyst Scott Schneeberger reiterated a Hold rating, following the company’s “F3Q21 outperformance.”

The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating. That’s based on 2 analysts suggesting a Buy and 5 analysts recommending a Hold. The average analyst price target of $361.80 implies 5.4% upside potential to current levels. Shares have rallied almost 93% over the past year.

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