1-Star Price
PREMIUM
5-Star Price
PREMIUM
Economic Moat
PREMIUM
Capital Allocation
PREMIUM
Wide-moat Cintas reported fiscal 2022 second-quarter earnings that were ahead of what was implied in our full-year expectations. We expect to increase our fair value estimate by a high-single-digit percentage due to increased revenue and the time value of money. Total revenue grew 9.4% year over year, and we are impressed with management’s continued efforts to improve its top line.
In its core uniform and facility services unit (80% of sales), Cintas provides uniform rental programs to businesses across the size spectrum, mostly in North America. The firm is by far the largest provider in the industry. Facilities products generally include the rental and sale of entrance mat, mops, shop towels, hand sanitizers, and restroom supplies. Cintas also runs a first aid and safety services business (11% of sales), a fire protection services business (6% of sales), and a uniform direct sales business (3% of sales).
