Report
Valens Research

CTAS - Embedded Expectations Analysis - 2021 08 11

Cintas Corporation (CTAS:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 32.3x Uniform P/E. At these levels, markets are pricing in bullish expectations for the firm, but management may be concerned about margin guidance, pricing decisions, and Fire Protection business growth.

Specifically, management may lack confidence in their ability to meet margin guidance, sustain organic growth in the Fire Protection business, and selectively raise pricing. In addition, they may be overstating the breadth of their product offerings and their commitment to ESG goals.
Underlying
Cintas Corporation

Cintas is a provider of corporate identity uniforms through rental and sales programs, as well as a provider of related business services, including entrance mats, restroom cleaning services and supplies, carpet and tile cleaning services, first aid and safety services and fire protection products and services. The company's segments are Uniform Rental and Facility Services, which consists of the rental and servicing of uniforms and other garments, including flame resistant clothing, mats, mops and shop towels and other ancillary items; and The First Aid and Safety Services, which consists of first aid and safety products and services.

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Valens Research
Valens Research

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  • GAAP and IFRS have failed to provide rules for reliable financial statement reporting
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Many years later, our business model remains because little has changed on Wall Street.

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