Truist Securities Reiterates Buy Rating on Cintas (CTAS), 'We think a permissive antitrust environment makes a deal more compelling'

Truist Securities analyst Jasper Bibb reiterated a Buy rating and $255.00 price target on Cintas (NASDAQ: CTAS).

The analyst commented: "We think a permissive antitrust environment makes a deal more compelling. The primary fundamental pushback we heard in January was skepticism that a deal could pass antitrust scrutiny. We note a deal would reduce the number of large national Uniform Rental players from four to three (Vestis (VSTS, NR) and privately-held Alsco remaining). We estimate UNF is the #3 domestic player in domestic Uniform Services with ~6% market share (including no program spend). Cintas would likely argue the company's primary competitors are Amazon (AMZN, Buy, Squali) and Walmart (WMT, Buy, Ciccarelli) as facilitators of insourced customer uniform programs. Cintas has previously stated the company only services ~1M of 16M businesses in North America, and we estimate a UNF combination would bring that total to 1.3M-1.4M. That being said, we acknowledge not all of the 16M businesses are necessarily suitable CTAS customers. We think the Trump administration's demonstrated tolerance for consolidation YTD should mitigate risk of a deal being blocked. "

For an analyst ratings summary and ratings history on Cintas click here. For more ratings news on Cintas click here.

Shares of Cintas closed at $185.28 yesterday.

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