What: Shares of Cintas Corporation (NASDAQ:CTAS) rose as much as 11.9% early Wednesday, and traded up 9.9% as of 3:30 p.m. EDT after the specialized business-services company released stronger-than-expected fiscal fourth-quarter 2016 results.
So what: Quarterly revenue climbed 11.3% year over year, to $1.27 billion, including healthy organic growth of 6.7%. On the bottom line, net income from continuing operations grew 17.3%, to $118 million, and -- thanks, in part, to stock repurchases over the past year -- earnings per diluted share from continuing operations increased an even better 25.6%, to $1.08. Analysts, on average, were only anticipating quarterly earnings of $1.00 per share on revenue of $1.25 billion.
That brought full fiscal-year 2016 revenue to $4.9 billion, up 9.6% over fiscal 2015, and above the high-end of Cintas' guidance for revenue in the range of $4.86 billion to $4.89 billion. Full-year earnings from continuing operations came in at $4.09 per share, up from $3.46 per share in 2015, and also above guidance that called for full-year EPS of $3.98 to $4.03.
Cintas CEO Scott Farmer lauded the initiation of the company's first national-branding campaign, which includes its new tag line, "Ready for the Workday," which speaks to the company's efforts to branch out from the uniform business for which it's primarily known. Farmer elaborated:
This new tag line communicates the value we provide our customers by addressing their business needs with our broad range of products and services. Our fourth-quarter results are a reflection of the success of our employees, whom we call partners, in being READY for our customers. I'd like to thank our partners for delivering industry-leading growth rates and operating income margins and a significant increase in EPS.
Now what: Cintas also offered an early look at the year ahead. Fiscal 2017 guidance calls for revenue of $5.15 billion to $5.225 billion, representing growth of 5% to 6.5% over fiscal 2016, and earnings per share of $4.35 to $4.45, or year-over-year growth of 6.4% to 8.8%. Here again, Wall Street is modeling fiscal 2017 revenue and earnings of $5.18 billion -- slightly below the midpoint of guidance -- and $4.32 per share, respectively.
In the end, this is a fairly cut-and-dry case of Cintas offering a gratifying combination of a strong end to its fiscal year, and an encouraging forecast for the one ahead. Assuming Cintas can sustain this momentum and keep widening the scope of its business, it's no surprise to see shares touching a fresh 52-week high today.
Steve Symington has no position in any stocks mentioned. The Motley Fool recommends Cintas. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.