Oppenheimer Reiterates Outperform on Cintas Corp. (CTAS) Following 1Q Report
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Oppenheimer reiterated an Outperform rating on Cintas Corp. (NASDAQ: CTAS) following the company's 1Q earnings report. CTAS reported adjusted EPS of $1.26, ahead of the consensus estimates of $1.08. Management updated FY17 EPS guidance to $4.55-4.63 from $4.35-4.45 vs. the consensus of $4.42.
Analyst Scott Schneeberger commented, "F1Q17 adj'd EPS of $1.26 exceeded our estimate/consensus of $1.05/$1.08, respectively, even after a $0.14 accounting change benefit. Revenue of $1.294B (+7.9% y/y, +5.7% y/y organically excluding acquisition impacts/forex) exceeded our estimate/consensus of $1.273B/$1.279B. CTAS updated FY17 revenue/adj'd EPS guidance to $5.160-5.225B (+5.2% to +6.5% y/y; from $5.150-5.225B)/$4.55-4.63 (+11% to +13% y/y; from $4.35-4.45). FY17 guidance assumes consistent US economic conditions/no additional share repurchases/no (pending) G&K acquisition impact including transaction expenses. The ~$0.20 FY17 EPS guidance increase is comprised of a net $0.07 accounting change benefit/margin improvement including less SAP opex/fewer shares. CTAS's solid organic growth/near-peak margins are anticipated to persist in FY17. Despite executing proficiently on apparent momentum, at 22.9x/22.1x our FY18E standalone/CTAS+G&K pro forma EPS we're maintaining Perform."
Shares of Cintas closed at $113.43 yesterday.
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