Updated 4/21/25
Cintas Corporation (CTAS) has built a reputation for reliable growth, strong operational execution, and disciplined financial management. Serving over a million businesses across North America, the company offers a broad range of services from uniform rentals to facility safety and first aid. Over the past year, it has delivered solid revenue growth, expanding margins, and rising free cash flow, while maintaining a high return on equity and shareholder-friendly policies.
With consistent dividend increases, a conservative payout ratio, and a leadership team deeply experienced within the company, Cintas has remained focused on long-term value creation. The stock has steadily appreciated, supported by strong fundamentals and a stable business model, even as valuations run higher than peers.
Recent Events
Over the past year, Cintas has been quietly outperforming. Its stock is up more than 23% over the last 12 months, well ahead of broader market benchmarks. The latest quarterly update, from February 2025, showed why: revenue climbed 8.4% year-over-year and earnings per share jumped a solid 16.6%. These aren’t flashy numbers—they’re just the kind you want to see from a business that executes well.
Profitability continues to impress, with a 17.5% net margin and an operating margin above 23%. This is a company that knows how to run lean. Return on equity came in at an eye-popping 40.3%, a clear reflection of how efficiently Cintas uses shareholder capital.
The company’s financial position looks healthy. Debt sits at $2.69 billion, but with $243 million in cash and strong cash generation, they’re not overleveraged. In fact, they’ve generated $1.62 billion in levered free cash flow over the past year—more than enough to fund operations, dividends, and the occasional acquisition.
One notable event was a 4-for-1 stock split in September 2024. While that doesn’t affect the business fundamentals, it does signal management’s confidence and can open the door for more retail interest. The upcoming dividend in June and the ex-dividend date in May suggest that dividend investors still have time to act.
Key Dividend Metrics
📈 Forward Dividend Yield: 0.76%
💰 Forward Dividend Rate: $1.56 per share
📅 Next Dividend Date: June 13, 2025
⏱️ Ex-Dividend Date: May 15, 2025
📉 5-Year Average Yield: 0.95%
🔄 Payout Ratio: 35%
📊 Dividend Growth Rate (5-Year): Over 15% annually
🏦 Cash Flow Coverage: $1.6B+ in free cash flow vs. ~$625M in dividend payments
Dividend Overview
Cintas won’t be found on lists of high-yield stocks, and that’s okay. Its dividend yield sits just under 1%, which won’t make anyone rich overnight. But for income-focused investors who care about quality, this is a name that can hold its own.
The current payout of $1.56 per share is modest, but it’s supported by a strong balance sheet and steady earnings. The company only uses about 35% of its earnings to pay dividends, which gives it plenty of flexibility. That means if business slows or the economy hits a rough patch, there’s still room to maintain or even grow the payout.
What’s more compelling is the total return story. Cintas has paired its small but growing dividend with consistent share appreciation. It’s not just handing out income—it’s compounding wealth.
Dividend Growth and Safety
Here’s where Cintas really starts to shine. The company has been growing its dividend at a pace that’s hard to ignore—averaging more than 15% annually over the past five years. That’s not something you often see from a large-cap company in a mature industry.
This kind of growth doesn’t come from cutting corners. It’s backed by real results: strong earnings, efficient operations, and disciplined financial management. The business is profitable, capital-light, and consistently generates more cash than it needs.
And let’s not forget—this is a management team that’s been shareholder-friendly over the long haul. The recent stock split is another sign of that philosophy. It doesn’t change the company’s fundamentals, but it does speak to confidence in its future.
There’s also not much short interest in the stock—just over 1% of outstanding shares. That’s usually a good sign that investors trust the story and don’t see any obvious cracks forming.
If you’re the type of investor who values steady, long-term growth in income and wants to hold businesses that manage capital well, Cintas offers a compelling case. This isn’t about chasing high yields—it’s about building reliable income from a company that plays the long game.
Cash Flow Statement
Over the trailing twelve months, Cintas generated $2.22 billion in operating cash flow, continuing a multi-year trend of consistent growth in core cash generation. This strength in operating cash has allowed the company to maintain a high level of financial flexibility while steadily increasing shareholder returns. Free cash flow came in at $1.83 billion, a solid increase from the prior year and more than enough to cover dividends and buybacks with room to spare.
Capital expenditures rose modestly to $396 million, reflecting ongoing investments in infrastructure and service expansion. On the financing side, Cintas returned $1.52 billion to shareholders, largely through aggressive share repurchases, which topped $910 million. This was nearly double the free cash flow allocated to capex, underlining the company’s preference for rewarding shareholders. The ending cash position, while down slightly from last year, remains stable at $247 million, with no recent debt issuance and minimal repayments, showing a balanced and deliberate use of capital.
Analyst Ratings
📊 Cintas Corporation has experienced a mix of analyst opinions recently, reflecting both confidence in its operational strength and caution over its valuation. 🎯 The consensus 12-month price target stands at $213.62, suggesting a modest upside from current levels.
📈 In March 2025, several firms adjusted their outlooks. Goldman Sachs increased its target from $211 to $233, maintaining a buy rating, citing strong earnings momentum and margin expansion. UBS also raised its target to $240, highlighting consistent revenue growth. Truist Financial lifted its target to $230, noting robust demand across service segments.
⚠️ On the flip side, a few analysts flagged valuation as a concern. Baird downgraded the stock to neutral, pointing to metrics like a forward P/E ratio above 45 and a PEG ratio near 4—levels that imply lofty growth expectations. Their view was that while the fundamentals remain solid, the current valuation may already price in much of that optimism.
🔍 Overall, analysts remain split. The stock carries a consensus rating of “Hold,” supported by 5 buy ratings, 7 holds, and 2 sells among 14 covering analysts. The tone of the coverage reflects a balancing act between Cintas’s impressive execution and the high bar set by its valuation.
Earning Report Summary
Cintas wrapped up its third quarter of fiscal 2025 with another solid showing, posting revenue of $2.61 billion. That’s an 8.4% jump from the same time last year, mostly driven by steady organic growth across its core businesses. About 7.9% of that came from existing operations doing more business, while acquisitions chipped in just under 1%. What really stood out this quarter was the margin improvement—gross margin climbed to 50.6%, up from 49.4%. It’s a small move on paper, but a big deal for a company that runs on tight operational control.
Strong Profits and Better Margins
Cintas saw its operating income climb to $609.9 million for the quarter, a 17.1% boost year-over-year. Part of that came from a $15 million gain related to the sale of some property and equipment, but the broader story is one of strong execution. Net income also moved higher, landing at $463.5 million, which is up nearly 17%. On a per-share basis, diluted earnings hit $1.13, marking a nice 17.7% lift from the year before.
As far as shareholder returns go, the company continues to be generous. It paid out $158.1 million in dividends during the quarter, which was almost 15% more than it paid out in the same period last year. For a company that’s not usually on the radar for big dividend yields, those consistent raises are a real plus for income-focused investors.
Comments from Leadership
CEO Todd Schneider had a lot of praise for the company’s team, referring to them as “employee-partners,” a term that gives a hint at Cintas’s internal culture. He credited the strong quarter to their hard work and focus on delivering value to customers. Schneider made it clear the company isn’t just riding a wave of luck—they’re executing well, sticking to their plan, and investing where it counts.
He also reiterated the company’s long-term strategy: deliver great products, keep improving service quality, and maintain the kind of work culture that makes employees want to stick around and grow with the business. It’s a formula that’s worked well for Cintas over the years, and based on this quarter, it continues to pay off.
Looking Ahead
Cintas made a small tweak to its full-year outlook, nudging revenue guidance to a range of $10.28 billion to $10.305 billion. The adjustment was mostly due to changes in foreign currency exchange rates, not because of any weakness in the business itself. More notably, they bumped up their full-year earnings forecast. The new EPS range is $4.36 to $4.40, which signals confidence in how the rest of the fiscal year will shape up.
All told, it was another clean quarter for Cintas—nothing flashy, just consistent delivery, strong execution, and a business that continues to hum along while keeping shareholders in mind.
Chart Analysis
CTAS has had a steady climb over the past year, but the most recent activity shows a shift in momentum that’s worth paying attention to. The stock made a strong run from last May through November, riding a clear uptrend with prices staying well above both the 50-day and 200-day moving averages. That period shows consistent higher highs and higher lows, a hallmark of strength.
Moving Averages
The red 50-day moving average crossed above the 200-day line early on and stayed above it through most of the year, confirming a bullish pattern. However, more recently, the two lines are beginning to converge. The 50-day has rolled over and is flattening out, while the 200-day continues its slow upward grind. This could signal a potential trend shift if the 50-day dips below. That crossover hasn’t happened yet, but it’s worth keeping on the radar since it often acts as a momentum signal.
Price Action
There was a sharp drop in late December that stands out, with the stock bouncing back quickly but then entering a range-bound phase. Since January, CTAS has been consolidating, trading mostly sideways between 190 and 210. The inability to break above recent highs or make new ones indicates a cooling-off period after last year’s strong run. Still, the fact that the price hasn’t broken down below the 200-day moving average speaks to underlying stability.
Management Team
Cintas Corporation’s leadership is rooted in continuity and long-term vision. Todd M. Schneider, the company’s CEO and President, has been with Cintas since 1989. He rose through the ranks by holding several senior roles across business units, including key leadership positions in sales and operational management. His deep familiarity with the company’s systems, people, and customers shapes his steady-handed approach to growth. Schneider has been vocal about maintaining the company’s strong culture, which is often described internally as performance-driven but employee-focused. Under his leadership, Cintas has emphasized steady execution, service excellence, and a commitment to building long-lasting client relationships.
J. Michael Hansen, the Executive Vice President and CFO, has also been with the company for nearly three decades. His role goes beyond just balancing the books. Hansen has overseen a prudent financial strategy that balances operational spending with healthy returns to shareholders. His style is measured and conservative, often preferring under-promising and over-delivering on forecasts. The company’s financial strength over the past several years reflects that approach.
James Rozakis, the current Chief Operating Officer, was appointed to his role in mid-2023 and oversees several of the company’s core service divisions. Like other senior executives at Cintas, Rozakis is a long-time insider. He’s been with the company since 1999 and understands its client-facing operations from the ground up. That hands-on experience is reflected in how Cintas has maintained consistent service quality even while scaling. The executive team doesn’t chase trends—they prioritize execution, consistency, and disciplined capital deployment.
Valuation and Stock Performance
Cintas stock has steadily marched higher over the past year, not in giant leaps, but in controlled, consistent moves. The stock is currently trading around $199 per share, slightly below its recent highs but still up considerably from where it stood a year ago. That upward trend has been supported by strong earnings and a business model that generates reliable cash flow regardless of broader economic noise.
From a valuation standpoint, Cintas does look expensive by traditional metrics. The forward P/E ratio sits near 43, and its price-to-sales multiple is over 8. That’s well above average for most companies in the business services space. The PEG ratio—an indicator that compares valuation to growth—is also elevated. It tells you that investors are paying a premium for quality and consistency.
But there’s a reason for the premium. Cintas runs with margins that would make many industrial or service companies envious. Its return on equity is north of 40%, and return on assets is comfortably in double digits. That kind of operational efficiency justifies a richer valuation. Investors appear willing to accept a higher price tag in exchange for stable earnings, steady dividend growth, and a management team that tends to deliver on its promises.
The recent price action shows some consolidation following a long upward run. After breaking above $220 earlier this year, the stock has pulled back slightly and now trades just below its 50-day moving average. Still, it remains above the 200-day average, suggesting longer-term strength is intact. The stock may not be racing higher week to week, but the long-term chart reflects the kind of calm upward slope many investors appreciate.
Risks and Considerations
While Cintas is known for its consistency, it isn’t without risks. One of the more notable concerns is valuation. At current levels, the stock trades at a significant premium to both its industry and the broader market. That doesn’t mean it’s due for a correction, but it does reduce the margin for error. If earnings come in lighter than expected or revenue growth slows, the stock could react more sharply than usual.
Another factor to consider is labor. Cintas operates a massive field workforce, and wage pressures have been growing across the service industry. So far, the company has managed this well, largely through operational efficiency and pricing power. But if wage inflation picks up again or retention issues begin to emerge, it could put pressure on margins.
Competition is another slow-moving but real factor. While Cintas has a dominant position in the uniform rental and facility services space, smaller regional players and niche providers are always trying to chip away at that base. The company’s scale is an advantage, but complacency isn’t an option.
There’s also the broader economic environment. Cintas serves a wide swath of industries—hospitality, healthcare, manufacturing—and if economic activity slows significantly in those sectors, that could eventually filter into slower order volume. While the recurring nature of its contracts provides some insulation, it’s not completely immune from economic downturns.
Finally, acquisitions are always a part of the company’s growth playbook. While past deals have been disciplined and mostly successful, acquisitions always carry integration risks. Paying too much or absorbing a poorly performing business can dilute returns, especially in a high-multiple stock like this one.
Final Thoughts
Cintas isn’t a stock that relies on excitement to deliver returns. Instead, it rewards investors through patience, consistency, and a strategy that has been remarkably durable over time. The management team is stable, the financials are clean, and the business itself is built to weather a variety of economic conditions. It doesn’t need a booming economy or a sudden shift in industry trends to perform. It just needs to execute, and historically, that’s exactly what it’s done.
While the stock isn’t cheap, and there are always risks to consider, the underlying story remains intact. It’s a business that generates dependable cash flow, returns capital to shareholders, and does so with a clear operational discipline. For investors who appreciate slow, steady compounders with a proven track record, Cintas continues to check many of the right boxes.