Cintas' Q2 Earnings Surpass Estimates, Revenues Increase Y/Y

Cintas Corporation CTAS reported second-quarter fiscal 2026 (ended Nov. 30, 2025) earnings of $1.21 per share, which beat the Zacks Consensus Estimate of $1.19. The bottom line rose 11% year over year despite an increase in operating costs.

Total revenues of $2.80 billion outperformed the consensus estimate of $2.76 billion. The top line rose 9.3% year over year, driven by higher segmental revenues. Organic sales were up 8.6% year over year.

Cintas’ Segmental Results

The company has two reportable segments, Uniform Rental and Facility Services and First Aid and Safety Services. Other businesses like Uniform Direct Sale and Fire Protection Services are included in All Other. Quarterly sales data is briefly discussed below.

Revenues from the Uniform Rental and Facility Services segment (representing 77% of the quarter’s net sales) totaled $2.16 billion, up 8.3% year over year. Our estimate for segmental revenues was $2.13 billion.

Revenues from the First Aid and Safety Services segment (representing 12.2% of the quarter’s net sales) totaled $342.2 million, up 14.3% year over year. Our estimate for segmental revenues was $345.9 million.

Revenues from All Other business (representing 10.8% of the quarter’s net sales) totaled $302.4 million, up 11.2% year over year. Our estimate for segmental revenues was $282.2 million.

Cintas Corporation Price, Consensus and EPS Surprise

Cintas Corporation price-consensus-eps-surprise-chart | Cintas Corporation Quote

CTAS’ Margin Profile

Cintas’ cost of sales (comprising costs related to uniform rental and facility services and others) increased 8% year over year to $1.39 billion. It represented 49.6% of net sales. Gross profit increased 10.6% to $1.41 billion. The gross margin was 50.4% compared with 49.8% in the year-ago period. Our estimate for the gross margin was pegged at 50.2%.

Selling and administrative expenses totaled $756.8 million, reflecting a 10.4% increase from the year-ago figure. It represented 27% of net sales. Operating income increased 10.9% year over year to $655.7 million. The operating margin was 23.4% compared with 26.8% in the year-ago quarter. Interest expenses increased 5.3% to $28.1 million.

Cintas’ Balance Sheet & Cash Flow

Exiting the first six months of fiscal 2026, Cintas had cash and cash equivalents of $200.8 million compared with $264 million at the end of fiscal 2025. Long-term debt was about $2.43 billion compared with $2.42 billion at the end of fiscal 2025. 

In the first six months of fiscal 2026, CTAS generated net cash of $945.7 million from operating activities, up 4.5% from the year-ago period. Capital expenditures in the same period totaled $208.2 million, up 7.2% year over year. Free cash flow increased 3.8% year over year to $737.5 million.

The company repurchased shares worth $901.7 million compared with $651.5 million in the year-ago period. Dividend payments totaled $340.1 million, up 15.1% year over year.

CTAS’ FY26 Guidance

For fiscal 2026, Cintas expects revenues to be in the range of $11.15-$11.22 billion compared with $11.06-$11.18 billion anticipated earlier. Earnings per share are estimated to be in the range of $4.81-$4.88 compared with $4.74-$4.86 anticipated earlier.

Cintas predicts net interest expenses of approximately $104 million. This compares with interest expenses of $95 million recorded in fiscal 2025. The effective tax rate is expected to be 20%.

CTAS’ Zacks Rank & Stocks to Consider

Cintas currently carries a Zacks Rank #3 (Hold). Some better-ranked companies are discussed below.

GIII Apparel Group GIII currently carries a Zacks Rank # 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

GIII delivered a trailing four-quarter average earnings surprise of 64.5%. In the past 60 days, the Zacks Consensus Estimate for GIII Apparel’s fiscal 2026 earnings has increased 6.3%.

Guess?, Inc. GES presently carries a Zacks Rank of 2. GES delivered a trailing four-quarter average earnings surprise of 45%.

In the past 60 days, the consensus estimate for GES’s 2025 earnings has increased 5.6%.

Ralph Lauren Corporation RL presently carries a Zacks Rank of 2. RL delivered a trailing four-quarter average earnings surprise of 9.8%.

In the past 60 days, the consensus estimate for Ralph Lauren’s 2025 earnings has increased 3%.

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This article originally published on Zacks Investment Research (zacks.com).

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