Why Is Corporate Apparel Company Cintas' Stock Jumping Today?

Cintas Corporation CTAS reported second-quarter FY24 sales growth of 9.3% year-on-year to $2.38 billion, beating the analyst consensus estimate of $2.34 billion.

Organic revenue growth rate, which adjusts for the impacts of acquisitions and foreign currency exchange rate fluctuations, was 9% for the quarter.

Gross margin expanded by 100 basis points Y/Y to 48% in the quarter.

Operating income increased 12.3% to $499.7 million, while the operating margin expanded by 50 basis points to 21%.

EPS of $3.61 beat the consensus estimate of $3.49.

The company held $85.6 million in cash and equivalents as of November 30, 2023. Operating cash flow for six months totaled $729.6 million, with a free cash flow of $529.1 million.

On December 15, 2023, Cintas paid an aggregate quarterly cash dividend of $137.5 million to shareholders, an increase of 17.1% from the amount paid last December.

Outlook: Cintas raised FY24 revenue outlook from $9.40 billion - $9.52 billion to $9.48 billion - $9.56 billion, against the consensus of $9.50 billion.

The company also raised FY24 EPS outlook from $14.00 - $14.45 to $14.35 - $14.65 versus an estimate of $14.46.

Price Action: CTAS shares are trading higher by 6.17% at $587.82 on the last check Thursday.

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