The 10-second takeaway
For the quarter ended Nov. 30 (Q2), Cintas beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue improved, and earnings per share increased significantly.
Margins expanded across the board.
Cintas tallied revenue of $1.0 billion. The nine analysts polled by S&P Capital IQ expected a top line of $1.0 billion. Sales were 8.8% higher than the prior-year quarter's $937 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
EPS came in at $0.57. The 14 earnings estimates compiled by S&P Capital IQ anticipated $0.48 per share. GAAP EPS of $0.57 for Q2 were 50% higher than the prior-year quarter's $0.38 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 42.2%, 50 basis points better than the prior-year quarter. Operating margin was 13%, 210 basis points better than the prior-year quarter. Net margin was 7.3%, 130 basis points better than the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods.
What does the future hold?
Next quarter's average estimate for revenue is $1.0 billion. On the bottom line, the average EPS estimate is $0.52 (There are 10 revenue estimates and seven EPS estimates.)
For the full year ending 2012, the average estimate for revenue is $4.1 billion. The average EPS estimate is $2.19. (There are 11 revenue estimates and seven EPS estimates.)
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 354 members out of 376 rating the stock outperform, and 22 members rating it underperform. Among 156 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 154 give Cintas a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cintas is outperform, with an average price target of $32.33.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of 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.