[Financial Highlights](index=1&type=section&id=Financial%20Highlights) Cintas achieved strong fiscal 2025 Q4 and full-year growth, marked by increased revenue, EPS, and significant capital returns Q4 Fiscal 2025 Performance vs. Q4 Fiscal 2024 | Metric | Q4 FY2025 | Q4 FY2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $2.67 billion | $2.47 billion | 8.0% | | Organic Revenue Growth | 9.0% | N/A | N/A | | Gross Margin | 49.7% | 49.2% | +50 bps | | Operating Income | $597.5 million | $547.6 million | 9.1% | | Net Income | $448.3 million | $414.3 million | 8.2% | | Diluted EPS | $1.09 | $1.00 | 9.0% | Full Year Fiscal 2025 Performance vs. Full Year Fiscal 2024 | Metric | FY2025 | FY2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $10.34 billion | $9.60 billion | 7.7% | | Organic Revenue Growth | 8.0% | N/A | N/A | | Operating Income | $2.36 billion | $2.07 billion | 14.1% | | Operating Margin | 22.8% | 21.6% | +120 bps | | Diluted EPS | $4.40 | $3.79 | 16.1% | - In fiscal 2025, Cintas demonstrated a strong commitment to shareholder returns and strategic growth[7](index=7&type=chunk) - **Capital Expenditures:** Spent **$408.9 million** (4.0% of revenue) - **Acquisitions:** Acquired businesses for a total of **$232.9 million** - **Dividends:** Paid **$611.6 million** in cash dividends, a **15.2% increase** over fiscal 2024 - **Share Buybacks:** Purchased **3.8 million shares** for **$679.3 million** at an average price of **$179.07 per share** [Management Commentary](index=1&type=section&id=Management%20Commentary) CEO Todd M. Schneider attributed strong results to strategic investments and operational excellence, with a future focus on customer service and sustainable growth - The CEO emphasized that strong organic revenue growth and record-high gross and operating margins were achieved through strategic investments and the dedication of employee-partners[8](index=8&type=chunk) - The company's focus for fiscal 2026 is on providing unmatched customer service, leveraging its unique culture, and delivering sustainable long-term results[9](index=9&type=chunk) [Fiscal 2026 Guidance](index=2&type=section&id=Fiscal%202026%20Guidance) Cintas projects fiscal 2026 revenue between $11.00 billion and $11.15 billion, with diluted EPS of $4.71 to $4.85, based on specific assumptions Fiscal 2026 Full-Year Guidance | Metric | Guidance Range | | :--- | :--- | | Revenue | $11.00 billion to $11.15 billion | | Diluted EPS | $4.71 to $4.85 | - Key assumptions for the fiscal 2026 guidance include[12](index=12&type=chunk) - Same number of workdays as fiscal 2025 - No future acquisitions - Constant foreign currency exchange rates - Net interest expense of approximately **$98.0 million** - Effective tax rate of **20.0%** - No future share buybacks or significant economic disruptions [Financial Statements](index=4&type=section&id=Financial%20Statements) The consolidated financial statements detail the company's strong revenue and profit growth, increased assets and equity, and robust operating cash flow allocation [Consolidated Condensed Statements of Income](index=4&type=section&id=Consolidated%20Condensed%20Statements%20of%20Income) Fiscal 2025 saw total revenue increase by 7.7% to $10.34 billion, with operating income up 14.1% to $2.36 billion, reflecting strong profit growth Q4 Income Statement Highlights (in thousands) | Account | Q4 FY2025 | Q4 FY2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $2,667,652 | $2,470,935 | 8.0% | | Operating Income | $597,452 | $547,594 | 9.1% | | Net Income | $448,256 | $414,315 | 8.2% | | Diluted EPS | $1.09 | $1.00 | 9.0% | Full Year Income Statement Highlights (in thousands) | Account | FY2025 | FY2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $10,340,181 | $9,596,615 | 7.7% | | Operating Income | $2,359,726 | $2,068,633 | 14.1% | | Net Income | $1,812,281 | $1,571,592 | 15.3% | | Diluted EPS | $4.40 | $3.79 | 16.1% | [Consolidated Condensed Balance Sheets](index=9&type=section&id=Consolidated%20Condensed%20Balance%20Sheets) As of May 31, 2025, Cintas's balance sheet strengthened with total assets increasing to $9.83 billion and shareholders' equity growing to $4.68 billion Balance Sheet Summary (in thousands) | Account | May 31, 2025 | May 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $3,436,169 | $3,185,207 | | Total Assets | $9,825,241 | $9,168,817 | | Total Current Liabilities | $1,644,502 | $1,828,519 | | Total Liabilities | $5,140,760 | $4,852,445 | | Total Shareholders' Equity | $4,684,481 | $4,316,372 | [Consolidated Condensed Statements of Cash Flows](index=10&type=section&id=Consolidated%20Condensed%20Statements%20of%20Cash%20Flows) Cintas generated $2.17 billion in operating cash flow for fiscal 2025, primarily used for capital expenditures, acquisitions, share repurchases, and dividends Cash Flow Summary for Fiscal Year 2025 (in thousands) | Activity | FY2025 | FY2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $2,165,905 | $2,068,500 | | Net Cash used in Investing Activities | ($623,638) | ($603,334) | | Net Cash used in Financing Activities | ($1,619,011) | ($1,247,506) | | Net (Decrease) Increase in Cash | ($78,042) | $217,866 | | Cash at End of Year | $263,973 | $342,015 | [Supplemental and Segment Data](index=6&type=section&id=Supplemental%20and%20Segment%20Data) This section provides deeper insights into Cintas's performance, highlighting improved margins, strong non-GAAP free cash flow, and robust segment-level growth [Margin Analysis](index=6&type=section&id=Margin%20Analysis) Cintas demonstrated improved profitability in fiscal 2025, with total gross margin expanding to 50.0% and net income margin increasing to 17.5% Margin Performance | Margin Type | FY2025 | FY2024 | Change (bps) | | :--- | :--- | :--- | :--- | | Uniform rental gross margin | 49.3% | 48.2% | +110 bps | | Other gross margin | 52.4% | 51.0% | +140 bps | | Total gross margin | 50.0% | 48.8% | +120 bps | | Net income margin | 17.5% | 16.4% | +110 bps | [Non-GAAP Financial Measures Reconciliation](index=6&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation) The company reconciled GAAP to non-GAAP measures, showing fiscal 2025 free cash flow increased to $1.76 billion and full-year organic revenue growth was 8.0% - Free cash flow for the twelve months ended May 31, 2025, was **$1.757 billion**, an increase from **$1.659 billion** in the prior year[24](index=24&type=chunk) Organic Revenue Growth Reconciliation | Period | Reported Revenue Growth (%) | Workday Adjustment (%) | Organic Revenue Growth (%) | | :--- | :--- | :--- | :--- | | Q4 FY2025 | 8.0% | +1.6% | 9.0% | | Full Year FY2025 | 7.7% | +0.9% | 8.0% | [Segment Performance](index=8&type=section&id=Segment%20Performance) For fiscal 2025, the Uniform Rental and Facility Services segment saw revenue grow to $7.98 billion, while First Aid and Safety Services showed robust growth to $1.22 billion Full Year Segment Performance (in thousands) | Segment | Revenue FY2025 | Revenue FY2024 | % Change | Operating Income FY2025 | Operating Income FY2024 | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Uniform Rental & Facility Services | $7,976,073 | $7,465,199 | 6.8% | $1,873,390 | $1,659,501 | 12.9% | | First Aid & Safety Services | $1,218,090 | $1,067,334 | 14.1% | $294,728 | $239,153 | 23.2% | | All Other | $1,146,018 | $1,064,082 | 7.7% | $191,608 | $169,979 | 12.7% |

Stock Performance & Earnings Growth - Cintas' shares experienced an explosion in 2023 and 2024 due to consistent earnings growth [4] - Cintas' year-to-date performance is up 179%, outperforming the S&P 500 [5][13] - Netflix's stock performance lagged behind Cintas over the past five years, with a 156% increase compared to Cintas' 206% [14][15] - Netflix's 2025 earnings are expected to be up 281%, with 2026 showing a 219% increase [10][11] Company Specifics - Cintas is a uniform company that has consistently met or exceeded earnings expectations [3][4] - Cintas acquired Unif, a competitor in the uniform sector, which is expected to further strengthen its market position [5] - Netflix was previously part of the "Fang Man" group but was later excluded from the "Magnificent Seven" [1][2] Valuation & Market Outlook - Cintas' PE ratio is 443%, considered stretched despite double-digit earnings growth [7] - Netflix's PE ratio is 49 times, which is considered expensive but justified by its growth trajectory [11] - The analysis encourages investors to look beyond the major tech stocks ("Fang Man", "Magnificent Seven") to identify well-performing companies like Cintas [16]

Core Viewpoint - Cintas Corporation (CTAS) is set to release its fourth-quarter fiscal 2025 results on July 17, with expectations of strong revenue growth and margin improvement despite rising costs [1][6]. Group 1: Revenue Expectations - The Uniform Rental and Facility Services segment is projected to generate revenues of $2.02 billion, reflecting a 5.7% increase year-over-year [2]. - The First Aid and Safety Services segment is expected to achieve revenues of $313.1 million, indicating a 12.8% increase from the previous year [3]. - Overall, the Zacks Consensus Estimate for total revenues is $2.63 billion, which represents a 6.3% increase compared to the same quarter last year [6]. Group 2: Margin and Cost Analysis - Cintas is anticipated to show an improvement in operating margin by 50 basis points from the prior year, driven by operational execution and pricing strategies [5]. - Selling, general and administrative (SG&A) expenses are expected to rise to $714.4 million, marking a 7% increase from the year-ago level, which may impact overall profitability [7]. Group 3: Acquisitions Impact - The acquisitions of Paris Uniform Services and SITEX are expected to contribute positively to revenues and enhance market presence in key regions [4][9].

Company Performance - BGSF has returned approximately 40.1% since the beginning of the calendar year, significantly outperforming the average gain of 4.1% in the Business Services group [4] - The Zacks Consensus Estimate for BGSF's full-year earnings has increased by 366.7% over the past 90 days, indicating improved analyst sentiment and a stronger earnings outlook [3] Industry Context - BGSF is part of the Business Services sector, which includes 260 individual stocks and currently holds a Zacks Sector Rank of 1 [2] - Within the Business - Services industry, which consists of 26 companies, BGSF ranks 37 in the Zacks Industry Rank, with the industry averaging a gain of 19.1% this year [6] Comparison with Peers - Cintas (CTAS), another stock in the Business Services sector, has returned 20.1% year-to-date and has a Zacks Rank of 2 (Buy) [4][5] - Both BGSF and Cintas are noted for their strong performance within the Business Services sector, attracting investor attention [7]

Core Viewpoint - Growth stocks are appealing due to their potential for above-average financial growth, but identifying strong growth stocks can be challenging due to associated risks and volatility [1] Group 1: Company Overview - Cintas (CTAS) is currently highlighted as a recommended growth stock based on the Zacks Growth Style Score, which evaluates a company's real growth prospects beyond traditional metrics [2] - Cintas has a favorable Growth Score and a top Zacks Rank, indicating strong potential for performance [2][10] Group 2: Earnings Growth - Cintas has a historical EPS growth rate of 16.1%, with projected EPS growth of 10.9% for the current year, surpassing the industry average of 8.9% [5][4] Group 3: Cash Flow Growth - The year-over-year cash flow growth for Cintas is 14.6%, significantly higher than the industry average of 3.4%, indicating strong cash accumulation capabilities [6] - The annualized cash flow growth rate for Cintas over the past 3-5 years is 10.9%, compared to the industry average of 7.1% [7] Group 4: Earnings Estimate Revisions - The current-year earnings estimates for Cintas have been revised upward, with the Zacks Consensus Estimate increasing by 0.1% over the past month, suggesting positive momentum [9][8] Group 5: Investment Potential - Cintas has achieved a Zacks Rank of 2 (Buy) and a Growth Score of B, positioning it as a potential outperformer and a solid choice for growth investors [10][11]

Company Overview - Cintas Corporation (CTAS) was founded in 1968 and is headquartered in Cincinnati, OH, primarily providing corporate identity uniforms along with various business services [1] Investment Philosophy - The investment philosophy emphasizes the importance of compounding, dividend reinvesting, and patient investing through market fluctuations to achieve wealth accumulation [1] - The approach combines steady investment in high-quality assets with high-risk, high-reward opportunities, underappreciated turnaround plays, and transformative technologies [1] Personal Background of the Investor - The investor describes themselves as an amateur, self-taught in investing with no formal education in the field, but knowledgeable in identifying credible sources [1] - The investor has over 20 years of teaching experience at the college/university level and holds a PhD from Brunel University, indicating a strong academic background [1]

Industry Overview - The U.S. Business Services Sector is supported by strong domestic economic fundamentals, encompassing companies that provide various services such as consulting, staffing, financial transactions, outsourcing, advertising, waste removal, building maintenance, technology services, and auction/valuation services [1] - The sector is mature with stable demand for services, and revenues, income, and cash flows are above pre-pandemic levels. It ranks in the top 25% of the Zacks Sector Rank, indicating expected outperformance over the next three to six months [2] Stock Recommendations - Five business services stocks with favorable Zacks Rank that have shown double-digit returns in the past three months are Duolingo Inc. (DUOL), Cintas Corp. (CTAS), Stantec Inc. (STN), Thomson Reuters Corp. (TRI), and FirstCash Holdings Inc. (FCFS). Each stock carries a Zacks Rank 2 (Buy) [3] Company Highlights Duolingo Inc. (DUOL) - Duolingo operates a mobile learning platform offering courses in 40 languages and provides a digital language proficiency assessment exam [6] - Expected revenue and earnings growth rates for the current year are 33.4% and 55.3%, respectively, with a 10.2% improvement in the Zacks Consensus Estimate for current-year earnings over the last 60 days [7][9] Cintas Corp. (CTAS) - Cintas is benefiting from solid momentum across its segments, with product penetration into existing customers aiding its Uniform Rental and Facility Services segment [8] - Expected revenue and earnings growth rates for the current year are 7% and 10.8%, respectively, with a 1.9% improvement in the Zacks Consensus Estimate for current-year earnings over the last 60 days [10] Stantec Inc. (STN) - Stantec provides professional consulting services in various fields including planning, engineering, architecture, and environmental sciences [11][12] - Expected revenue and earnings growth rates for the current year are 11.1% and 19.5%, respectively, with a 3.2% improvement in the Zacks Consensus Estimate for current-year earnings over the last 30 days [13] Thomson Reuters Corp. (TRI) - Thomson Reuters operates as a content and technology company across multiple regions, providing value-added information and technology in law, tax, accounting, and other fields [14][15] - Expected revenue and earnings growth rates for the current year are 3.2% and 4.2%, respectively, with a 1.3% improvement in the Zacks Consensus Estimate for current-year earnings over the last 60 days [15] FirstCash Holdings Inc. (FCFS) - FirstCash operates retail pawn stores in the U.S., Mexico, and Latin America, providing pawn loans and retail payment solutions [16][17] - Expected revenue and earnings growth rates for the current year are -0.2% and 17.3%, respectively, with a 2.7% improvement in the Zacks Consensus Estimate for current-year earnings over the last 60 days [18]

Core Insights - Cintas Corporation (CTAS) is expected to benefit from strong segment performance, technology investments, and strategic acquisitions, making it an attractive stock for investors [1] Business Performance - Cintas has shown solid momentum across all segments, with strong growth from new customers and increased product penetration in the Uniform Rental and Facility Services segment [5] - The First Aid and Safety Services segment is experiencing rising demand for AED Rentals, eyewash stations, and WaterBreak products, contributing to overall performance [5] - Cintas forecasts a 7.7% year-over-year increase in organic revenues for fiscal 2025 [5] Expansion Efforts - Cintas is enhancing its market presence through acquisitions, including Paris Uniform Services and SITEX, which have strengthened its position in key regions [6] - The company spent $198.8 million on acquisitions in the first nine months of fiscal 2025 [6] Product Enhancement - Cintas is focused on enhancing its product portfolio and investing in technology, including SmartTruck technology for route optimization and garment-sharing technology [7] - Partnerships with Verizon and Google aim to provide technology solutions that enhance customer experience [7] Shareholder Returns - Cintas has a strong track record of returning cash to shareholders, with dividends totaling $453.7 million in the first nine months of fiscal 2025, a 14.4% increase year-over-year [9] - The company repurchased $678.1 million in shares during the same period, up from $468.1 million the previous year [9] - Cintas raised its quarterly dividend by 15.6% to $1.56 per share in July 2024, marking 40 consecutive years of dividend increases [9]

Industry Overview - The business services industry is experiencing sustained expansion, with economic activity in the services sector growing for the 10th consecutive month as of April, indicated by a robust Services PMI remaining above the 50% threshold for the 56th time in 59 months, reflecting a post-pandemic recovery [1] - The industry is mature, with revenues, income, and cash flows now exceeding pre-pandemic levels, and it ranks in the top 19% of the Zacks Sector Rank, suggesting an expected outperformance over the next three to six months [3] Technological Impact - The rapid advancement and adoption of artificial intelligence and automation technologies are transforming the delivery of business services, promising enhanced efficiency and cost reduction while also presenting challenges such as workforce displacement and the need for continuous upskilling [2] Stock Recommendations - Five business services stocks with favorable Zacks Rank for investment are recommended: Cintas Corp. (CTAS), Thomson Reuters Corp. (TRI), Healthcare Services Group Inc. (HCSG), ZipRecruiter Inc. (ZIP), and Bright Horizons Family Solutions Inc. (BFAM), all currently carrying a Zacks Rank 2 (Buy) [4] Company Highlights Cintas Corp. (CTAS) - Cintas is well-positioned to benefit from strong momentum across its segments, with improved demand in its Uniform Rental and Facility Services segment and First Aid and Safety Services segment [7] - Expected revenue and earnings growth rates for CTAS are 7% and 10.8%, respectively, for the next year, with a 1.7% improvement in the Zacks Consensus Estimate for next-year earnings over the past 60 days [8] Thomson Reuters Corp. (TRI) - TRI operates as a content and technology company across various regions and segments, providing value-added information and technology in fields such as law, tax, accounting, and healthcare [9][10] - Expected revenue and earnings growth rates for TRI are 3.1% and 4.2%, respectively, for the current year, with a 1.3% improvement in the Zacks Consensus Estimate for current-year earnings over the past 30 days [10] Healthcare Services Group Inc. (HCSG) - HCSG provides management and operational services to healthcare facilities, making it a preferred choice for clients in the sector [11][12] - Expected revenue and earnings growth rates for HCSG are 5.1% and 58.5%, respectively, for the current year, with a 5% improvement in the Zacks Consensus Estimate for current-year earnings over the past seven days [12] ZipRecruiter Inc. (ZIP) - ZIP operates an online marketplace connecting job seekers and employers, offering various recruitment and hiring services [13] - Expected revenue and earnings growth rates for ZIP are 9% and 13%, respectively, for the next year, with a 3.8% improvement in the Zacks Consensus Estimate for next-year earnings over the past 30 days [14] Bright Horizons Family Solutions Inc. (BFAM) - BFAM provides employer-sponsored child care and early education solutions, managing child care centers for various organizations [15][16] - Expected revenue and earnings growth rates for BFAM are 7.6% and 18.4%, respectively, for the current year, with a significant 24.6% improvement in the Zacks Consensus Estimate for current-year earnings over the past 30 days [17]

Core Viewpoint - O'Reilly Automotive is positioned as a strong investment opportunity, with solid business fundamentals and a proposed stock split aimed at increasing accessibility for investors and employees [3][4][11]. Group 1: Financial Performance - O'Reilly Automotive reported Q1 revenue of $4.14 billion, reflecting a 4% year-over-year increase, driven by a 3.6% comparable store gain [6]. - The company achieved a quarterly net income of $538 million, maintaining positive cash flow while returning capital to shareholders through share repurchases [8]. - Despite margin contraction due to increased cost pressures, the earnings remain robust enough to sustain the financial outlook [8]. Group 2: Stock Split and Market Impact - A proposed 15:1 stock split is set for a vote in May, aimed at making shares more accessible and potentially benefiting the broader market [3][4]. - Historical data suggests that stocks that undergo splits tend to outperform the market over time, indicating a positive outlook for O'Reilly post-split [4]. - Analysts have raised their price targets following the guidance update, with a consensus target of $1,412.06, suggesting a potential upside of 4.83% [10][11]. Group 3: Analyst Sentiment - The consensus among 18 analysts remains bullish, with all recent revisions indicating price target increases [11]. - The stock price is currently experiencing a pullback from record highs but shows signs of forming a bullish consolidation, with potential for further increases [12]. - Support is anticipated near the $1,300 level, which may be retested before reaching new highs [13].