Cintas Corp. (NASDAQ:CTAS) reported fiscal fourth-quarter 2026 results on Wednesday that topped Wall Street estimates, driven by broad-based revenue growth and record margins. Shares rose following the release.
Revenue increased 8.9% year over year to $2.91 billion, beating the analyst consensus estimate of $2.87 billion. Organic revenue grew 8.4%.
Record Margins Drive Profit Growth
GAAP diluted earnings per share increased 15.6% to $1.26 from $1.09 a year earlier, topping analysts’ estimate of $1.23.
Adjusted diluted EPS rose 18.3% to $1.29, excluding 3 cents per share in expenses related to the proposed acquisition of UniFirst Corp. (NYSE:UNF).
Net income climbed 14% to $511 million. Gross profit rose 11.6% to $1.48 billion, while gross margin expanded 130 basis points to a record 51%.
Operating income increased 12.7% to $673 million, and operating margin improved to 23.2% from 22.4% a year earlier. Results included $14 million in UniFirst transaction-related expenses.
Rental, First Aid Businesses Fuel Growth
Revenue from the Uniform Rental and Facility Services segment rose 8.2% to $2.20 billion. Operating income increased to $529.5 million from $465.1 million a year earlier.
First Aid and Safety Services revenue grew 13.5% to $368.1 million, while operating income increased to $98.6 million from $76.7 million.
Revenue in the All Other segment rose 8.6% to $339.4 million, with operating income increasing to $59 million from $55.7 million.
Cash Flow Improves, UniFirst Deal Progresses
For fiscal 2026, revenue increased 8.9% to $11.26 billion, while organic revenue grew 8.3%. GAAP diluted EPS rose 11.6% to $4.91, and adjusted diluted EPS increased 12.3% to $4.94.
Operating cash flow increased to $2.28 billion, while free cash flow rose to $1.88 billion. During the year, Cintas invested $395.1 million in capital expenditures and returned $1.65 billion to shareholders through dividends and share repurchases.
The company ended the fiscal year with $289 million in cash and approximately $2.43 billion in total debt.
Cintas said UniFirst shareholders approved the proposed acquisition on June 11. The companies also received a second request for information from the Federal Trade Commission. Cintas continues to expect the transaction to close in the second half of calendar 2026.
Fiscal 2027 Outlook
For fiscal 2027, Cintas forecast revenue of $12.10 billion to $12.25 billion, above the analyst consensus estimate of $12.08 billion. The outlook implies annual growth of 7.4% to 8.7%.
The company expects adjusted diluted EPS of $5.36 to $5.50, compared with analysts’ estimate of $5.43. That represents projected growth of 8.5% to 11.3%.
The outlook excludes the proposed UniFirst acquisition, future acquisitions, nonrecurring transaction costs, future share repurchases and significant economic disruptions. It assumes constant foreign exchange rates and includes one additional workday.
Cintas expects fiscal 2027 net interest expense of about $105 million, up from $101.2 million in fiscal 2026, primarily due to amortization of bridge-loan financing costs related to the UniFirst acquisition. The company expects an effective tax rate of 20.2%.
During the earnings call, management stressed that Cintas still sees significant room for expansion despite an uncertain economic backdrop. CEO Todd Schneider said the company’s total addressable market remains “massive,” allowing it to grow across different economic cycles.
“But because of the opportunity out there and because of how we help customers run a better business, the opportunities are virtually endless for us.”
CTAS Price Action: Cintas shares were up 4.03% at $191.75 at the time of publication on Wednesday, according to Benzinga Pro data.
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