UniFirst Earnings Preview

Investors hope UniFirst (NYSE: UNF  ) will top analyst estimates once again after beating predictions by $0.08 in the previous quarter. The company will unveil its latest earnings on Tuesday. UniFirst designs, manufactures, personalizes, rents, cleans, delivers, and sells a wide range of uniforms and protective clothing.

What analysts say:
 

• Buy, sell, or hold?: Analysts think investors should stand pat on UniFirst with five of six analysts rating it hold. Analysts don't like UniFirst as much as competitor G&K Services overall. Three out of seven analysts rate G&K Services a buy compared to one of six for UniFirst. Analysts' rating of UniFirst has stayed constant from three months prior.
• Revenue forecasts: On average, analysts predict $284.3 million in revenue this quarter. That would represent a rise of 11.5% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.85 per share. Estimates range from $0.77 to $0.90.

What our community says:
CAPS All-Stars are solidly behind the stock with 96% assigning it an outperform rating. The community at large agrees with the All-Stars with 89.6% awarding it a rating of outperform. Fools are keen on UniFirst, though the message boards have been quiet lately with only 26 posts in the past 30 days. The bullish CAPS rating of five out of five stars for UniFirst outpaces Fool enthusiasm for the company.

Management:
Revenue has now gone up for three straight quarters. The company's gross margin shrank by 2.8 percentage points in the last quarter. Revenue rose 11.6% while cost of sales rose 16.8% to $185.2 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter	Q3	Q2	Q1	Q4
Gross Margin	36.5%	36.7%	40.2%	38.8%
Operating Margin	10.0%	9.9%	14.3%	11.3%
Net Margin	6.3%	5.8%	8.7%	6.8%

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