Cintas Corporation (CTAS)

Financial leverage ratio

		May 31, 2024	May 31, 2023	May 31, 2022	May 31, 2021	May 31, 2020
Total assets	US$ in thousands	9,168,820	8,546,360	8,147,260	8,236,820	7,669,880
Total stockholders’ equity	US$ in thousands	4,316,370	3,863,990	3,308,200	3,687,850	3,235,200
Financial leverage ratio		2.12	2.21	2.46	2.23	2.37

May 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $9,168,820K ÷ $4,316,370K
= 2.12

The financial leverage ratio of Cintas Corporation has exhibited fluctuations over the past five years. In the most recent fiscal year ending May 31, 2024, the financial leverage ratio stands at 2.12, indicating that the company's debt component accounts for approximately 2.12 times the equity component in its capital structure. Compared to the prior year, there seems to have been a slight decrease in leverage, as the ratio was 2.21 in May 31, 2023.

Looking back further, in May 31, 2022, Cintas had a higher financial leverage ratio of 2.46, suggesting that the company relied more heavily on debt to finance its operations and growth initiatives. However, there was a subsequent decrease in leverage in May 31, 2021 and May 31, 2020, with ratios of 2.23 and 2.37 respectively.

It is important to note that changes in the financial leverage ratio can signify shifts in the company's risk profile and financial stability. A declining ratio may indicate a reduction in financial risk and potentially greater financial flexibility, while an increasing ratio may signal higher financial risk and a heavier debt burden. Further analysis of Cintas Corporation's capital structure and debt management strategies would be necessary to fully assess the implications of these fluctuations in the financial leverage ratio.