Cintas Corporation (CTAS)

Financial leverage ratio

		Feb 28, 2025	Nov 30, 2024	Aug 31, 2024	May 31, 2024	Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020
Total assets	US$ in thousands	9,611,140	9,366,530	9,068,710	9,481,300	8,978,880	8,813,870	8,719,680	8,546,360	8,466,000	8,427,010	8,261,030	8,147,260	8,168,600	8,017,410	7,857,750	8,236,820	8,347,500	8,454,750	8,043,380	7,669,880
Total stockholders’ equity	US$ in thousands	4,592,250	4,293,110	4,021,420	4,316,370	4,234,080	3,994,480	4,077,640	3,863,990	3,633,260	3,430,540	3,229,630	3,308,200	3,293,900	3,563,130	3,309,200	3,687,850	3,816,510	3,597,960	3,604,800	3,235,200
Financial leverage ratio		2.09	2.18	2.26	2.20	2.12	2.21	2.14	2.21	2.33	2.46	2.56	2.46	2.48	2.25	2.37	2.23	2.19	2.35	2.23	2.37

February 28, 2025 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $9,611,140K ÷ $4,592,250K
= 2.09

The financial leverage ratio of Cintas Corporation over the period from May 31, 2020, to February 28, 2025, exhibits notable fluctuations, reflecting dynamic changes in the company's capital structure. Initially, the ratio stood at 2.37 in May 2020, indicating a moderate reliance on debt relative to equity. It experienced a slight decline to 2.23 by August 2020, suggesting a marginal reduction in leverage. The ratio then increased to 2.35 in November 2020 before decreasing again to 2.19 in February 2021.

Throughout 2021, the leverage ratio demonstrated relative stability, with values oscillating around the 2.2 to 2.37 range. Notably, it reached a peak of 2.48 in February 2022, indicating an increased reliance on debt financing. Subsequently, the ratio broadly trended downward, recording 2.46 in May 2022, 2.56 in August 2022, and then declining to 2.46 in November 2022. This pattern suggests some periods of increased leverage, followed by minor reductions.

From late 2022 onwards, the leverage ratio displayed a consistent decreasing trend, reaching 2.33 in February 2023 and gradually declining further to 2.21 in May 2023. The ratio continued to decline through the remainder of 2023, reaching a low of 2.14 in August 2023, before slightly increasing again to 2.21 in November 2023. Early 2024 figures show a modest decrease to 2.12 in February, with a subsequent incremental increase to 2.20 in May 2024 and 2.26 in August 2024, before a slight decline to 2.18 in November 2024. As of February 2025, the ratio stands at 2.09.

Overall, the data indicates that Cintas Corporation’s financial leverage ratio has generally trended downward over the observed period, with some cyclical fluctuations. This trend may reflect a strategic effort to reduce reliance on debt, enhance financial stability, and optimize capital structure. The ratios remain within a range that suggests manageable leverage, aligning with prudent financial management priorities.