Cintas Corporation CTAS is all set to unveil its third-quarter fiscal 2024 results on Mar 27, before the market starts humming.
The Zacks Consensus Estimate for the company’s fiscal third-quarter earnings has kept steady in the last 60 days. As history would have it, Cintas has quite a track record of surprising with its earnings, always managing to outdo the Zacks Consensus Estimate each quarter for the last four, averaging a beat of 3.5% every time.
To better understand what’s brewing for Cintas’ fiscal third-quarter earnings, let’s take a look under the hood.
Cintas Corporation Price and EPS Surprise
Cintas Corporation price-eps-surprise | Cintas Corporation Quote
Factors to Take Note Of
Anticipate a surging demand from the company’s health care, education, and government sectors, propelling the Uniform Rental and Facility Services segment in the fiscal third-quarter. With operational efficiency on the rise and new product launches, this segment is expected to shine with revenues likely climbing by 7% compared to the prior year.
The health and wellness divisions are expected to contribute significantly to the First Aid and Safety Services segment’s performance, with an estimated revenue increase of a mighty 10.4% from last year’s numbers.
Lively growth across the uniform direct sale and fire protection services is fueling the All-Other business segment’s activities. The projection for the quarter suggests a substantial 15.7% revenue growth compared to the same quarter last year.
Cintas is on track for a robust margin performance in the forthcoming quarter, mainly due to its attention to operational efficiency and pricing strategies. We anticipate a 30 basis points improvement in the company’s operating margin compared to the previous year.
Nonetheless, rising costs of sales and selling, general, and administrative expenses are looming over, which might dampen the bottom-line results. For the period under review, we foresee SG&A expenses climbing 9% from the year prior. Also, with its foothold in international markets, the company might face some foreign exchange challenges affecting its revenue streams.
What the Zacks Modelling Unveils
Our predictive model does not definitively point towards an earnings outperformance for Cintas this time around. Typically, a favourable combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the likelihood of an earnings beat. In this case, however, the indicators do not align.
CTAS is sitting at an Earnings ESP of 0.00% as both the Zacks Consensus Estimate and the Most Accurate Estimate is set at $3.56. For more insights on stocks before they hit the headlines, check out our Earnings ESP Filter.
CTAS currently holds a Zacks Rank #3. For the full list of today’s Zacks #1 Rank stocks, swing by the complete list here.
Recap of Previous Earnings
In the second quarter of fiscal 2024 (ended Nov 30, 2023), Cintas reported earnings of $3.61 per share, topping the Zacks Consensus Estimate of $3.48. Despite high costs, the bottom line saw a 15.7% increase year over year.
Total revenues of $2,377.2 million surpassed the Zacks Consensus Estimate of $2,336 million, zooming up by 9.3% year over year, driven by robust segmental revenues. The organic sales also spiked by a sweet 9% year over year.
Peek at Other Industrial Performances
A. O. Smith Corporation AOS churned out adjusted earnings of 97 cents per share in the fourth quarter of 2023, topping the Zacks Consensus Estimate of 96 cents. The earnings spiked by 13% year over year as net sales of $988.1 million narrowly missed the consensus estimate of $989 million, but still clocked a 5.6% increase year over year.
Illinois Tool Works Inc. ITW delivered adjusted earnings of $2.42 per share in the fourth quarter of 2023, exceeding the Zacks Consensus Estimate of $2.40. Earnings rose by 3.4% year over year. The revenues of $3.98 billion were slightly below the consensus estimate of $4.01 billion, still managing a modest 0.3% increase year over year.
Nordson Corporation NDSN unveiled adjusted earnings of $2.21 per share in the first quarter of fiscal 2024 (ended Jan 31, 2024), sailing past the Zacks Consensus Estimate of $2.03. The bottom line surged by 13.3% year over year as the revenues of $633.2 million trounced the consensus estimate of $630 million, marking a 3.7% growth year over year.
For more on upcoming earnings, hop on to the Zacks Earnings Calendar.
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The observations expressed here represent the views and opinions of the writer, and do not necessarily mirror those of Nasdaq, Inc.
