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Cintas (CTAS) to Report Q4 Earnings: What's in the Offing?
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Cintas Corporation (CTAS - Free Report) is slated to report fourth-quarter fiscal 2020 (ended May 2020) results on Jul 23, before market open.
The company pulled off an earnings surprise of 8.33%, on average, in the preceding four quarters, surpassing estimates in all occasions. In the fiscal third quarter (ended February 2020), Cintas reported adjusted earnings of $2.16 per share, which surpassed the Zacks Consensus Estimate of $2.02 by 6.93%.
In the past three months, the company’s shares have rallied 40.7% compared with the industry’s growth of 38.6%.
Factors at Play
Cintas is expected to have benefited from strength in its Uniform Rental and Facility Services, and First Aid and Safety Services segments during the fiscal fourth quarter. The company added COVID-19-related products to its portfolio, and expanded its scope of services and work during the pandemic, which are likely to have augmented its top-line performance. In addition, its focus on improving the customer base might have supported growth.
Also, the acquisition of G&K Services Inc. (completed in March 2017), which strengthened product portfolio and processing capacity as well as improved customer service, is anticipated to have boosted fiscal fourth-quarter revenues. In addition, benefits from the implementation of the enterprise resource planning system and investment in technology are expected to get reflected in the company’s upcoming results.
However, the overall low demand environment, owing to the coronavirus outbreak-led issues, is expected to have a bearing on the company’s top-line performance in the fiscal fourth quarter. Notably, at the end of the previous quarter, it refrained from providing its outlook for the fourth quarter and fiscal 2020 due to the severity and uncertainty of the coronavirus pandemic. In addition, the company continues to experience cost pressure in certain areas, including rising variable costs and that related to enterprise resource planning system implementation. These are anticipated to have put pressure on its margins and profitability in the quarter to be reported.
Amid this backdrop, the Zacks Consensus Estimate for fiscal fourth-quarter revenues for Uniform Rental and Facility Services is currently pegged at $1,229 million, indicating a decline of 13.9% from the year-ago reported figure. Revenues for First Aid and Safety Services are anticipated to be strong, with estimates pegged at $182 million, implying year-over-year growth of 11%. In addition, the consensus estimate for revenues for the All Other segment, which includes uniform direct sale and fire protection services businesses, currently stands at $142 million, suggesting a year-over-year decline of 29.7%.
Earnings Whispers
According to our quantitative model, a stock needs to have the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or at least 3 (Hold) to increase the odds of an earnings beat. But that is not the case here as we will see below.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Cintas has an Earnings ESP of 0.00% as both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at earnings of $1.23 per share.
Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Donaldson Company, Inc. (DCI - Free Report) carries a Zacks Rank #3 and has an Earnings ESP of +6.02%.
Emerson Electric Co. (EMR - Free Report) carries a Zacks Rank #3 and has an Earnings ESP of +2.60%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Image: Bigstock
Cintas (CTAS) to Report Q4 Earnings: What's in the Offing?
Cintas Corporation (CTAS - Free Report) is slated to report fourth-quarter fiscal 2020 (ended May 2020) results on Jul 23, before market open.
The company pulled off an earnings surprise of 8.33%, on average, in the preceding four quarters, surpassing estimates in all occasions. In the fiscal third quarter (ended February 2020), Cintas reported adjusted earnings of $2.16 per share, which surpassed the Zacks Consensus Estimate of $2.02 by 6.93%.
In the past three months, the company’s shares have rallied 40.7% compared with the industry’s growth of 38.6%.
Factors at Play
Cintas is expected to have benefited from strength in its Uniform Rental and Facility Services, and First Aid and Safety Services segments during the fiscal fourth quarter. The company added COVID-19-related products to its portfolio, and expanded its scope of services and work during the pandemic, which are likely to have augmented its top-line performance. In addition, its focus on improving the customer base might have supported growth.
Also, the acquisition of G&K Services Inc. (completed in March 2017), which strengthened product portfolio and processing capacity as well as improved customer service, is anticipated to have boosted fiscal fourth-quarter revenues. In addition, benefits from the implementation of the enterprise resource planning system and investment in technology are expected to get reflected in the company’s upcoming results.
However, the overall low demand environment, owing to the coronavirus outbreak-led issues, is expected to have a bearing on the company’s top-line performance in the fiscal fourth quarter. Notably, at the end of the previous quarter, it refrained from providing its outlook for the fourth quarter and fiscal 2020 due to the severity and uncertainty of the coronavirus pandemic. In addition, the company continues to experience cost pressure in certain areas, including rising variable costs and that related to enterprise resource planning system implementation. These are anticipated to have put pressure on its margins and profitability in the quarter to be reported.
Amid this backdrop, the Zacks Consensus Estimate for fiscal fourth-quarter revenues for Uniform Rental and Facility Services is currently pegged at $1,229 million, indicating a decline of 13.9% from the year-ago reported figure. Revenues for First Aid and Safety Services are anticipated to be strong, with estimates pegged at $182 million, implying year-over-year growth of 11%. In addition, the consensus estimate for revenues for the All Other segment, which includes uniform direct sale and fire protection services businesses, currently stands at $142 million, suggesting a year-over-year decline of 29.7%.
Earnings Whispers
According to our quantitative model, a stock needs to have the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or at least 3 (Hold) to increase the odds of an earnings beat. But that is not the case here as we will see below.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Cintas has an Earnings ESP of 0.00% as both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at earnings of $1.23 per share.
Cintas Corporation Price and EPS Surprise
Cintas Corporation price-eps-surprise | Cintas Corporation Quote
Zacks Rank: Cintas carries a Zacks Rank #2.
Stocks to Consider
Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Colfax Corporation has an Earnings ESP of +33.33% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Donaldson Company, Inc. (DCI - Free Report) carries a Zacks Rank #3 and has an Earnings ESP of +6.02%.
Emerson Electric Co. (EMR - Free Report) carries a Zacks Rank #3 and has an Earnings ESP of +2.60%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Click here for the 6 trades >>