Cintas (CTAS) is expected to raise its fiscal 2027 outlook driven by better-than-expected first-quarter results amid robust revenue growth, RBC Capital Markets said in a note emailed Thursday.
The uniform supplier guided for full-year revenue of $12.10 billion to $12.25 billion in July and adjusted earnings per share of $5.36 to $5.50. RBC expects the company to lift revenue projections to between $12.15 billion and $12.27 billion and set the EPS outlook in the range of $5.40 to $5.55.
Analysts polled by FactSet expect $5.50 in adjusted EPS on revenue of $12.22 billion.
"We anticipate an upward revision to (fiscal 2027) guidance on the back of the potential (first-quarter) outperformance," RBC analysts Ashish Sabadra said.
The brokerage expects Cintas' fiscal first-quarter revenue growth of 9.9% annually to $2.99 billion and earnings per share of $1.39, exceeding consensus views that RBC put at 9.5% and $1.34, respectively.
"The uncertain macro environment is creating incremental outsourcing opportunities as customers look to reduce distractions and focus on their core business, driving strong retention, new business wins, and healthy cross-selling activity across the existing customer base," Sabadra said.
RBC has a sector perform rating on Cintas' stock with a $206 price target.
Cintas remains on track to close its proposed $5.5 billion acquisition of UniFirst (UNF) by the end of calendar year 2026, the brokerage said. Both the company and RBC expect the transaction to be accretive to EPS by the end of the second full year after completion.
"This suggests near-term integration costs will be offset by synergy realization by (fiscal 2028), which should provide meaningful shareholder value creation onwards," Sabadra wrote.
Shares of the company were down 1.1% intraday Thursday, and have gained 8.2% this year.
Price: $203.92, Change: $-1.86, Percent Change: -0.90%
