Cintas Corporation (CTAS)
Interest coverage
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 | ||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 2,322,194 | 2,232,723 | 2,143,683 | 2,081,473 | 1,999,866 | 1,923,284 | 1,866,212 | 1,804,380 | 1,737,248 | 1,697,724 | 1,633,730 | 1,588,219 | 1,152,828 | 1,071,665 | 1,043,392 | 998,367 | 857,825 | 845,757 | 827,098 | 782,999 |
Interest expense (ttm) | US$ in thousands | 101,124 | 101,890 | 101,815 | 100,740 | 102,437 | 105,726 | 108,056 | 111,232 | 108,517 | 101,728 | 94,710 | 88,844 | 90,337 | 92,859 | 95,514 | 98,210 | 99,611 | 101,002 | 102,622 | 105,393 |
Interest coverage | 22.96 | 21.91 | 21.05 | 20.66 | 19.52 | 18.19 | 17.27 | 16.22 | 16.01 | 16.69 | 17.25 | 17.88 | 12.76 | 11.54 | 10.92 | 10.17 | 8.61 | 8.37 | 8.06 | 7.43 |
February 28, 2025 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,322,194K ÷ $101,124K
= 22.96
The analysis of Cintas Corporation’s interest coverage ratios over the specified periods indicates a robust and generally improving capacity to meet interest obligations from operating earnings. Starting from a ratio of 7.43 as of May 31, 2020, the metric demonstrated a consistent upward trend, reaching 22.96 by February 28, 2025.
Throughout the period from mid-2020 to early 2025, the interest coverage ratio experienced steady growth, reflecting a strengthening ability to cover interest expenses. Notably, between May 2020 and May 2021, there was significant improvement, with the ratio increasing from 7.43 to 10.17, signaling enhanced operational profitability relative to interest obligations. This positive trend continued thereafter, with ratios crossing into double digits, indicating healthier coverage.
From mid-2021 onwards, the ratio displayed sustained growth, frequently surpassing 16, with a peak of 22.96 observed in February 2025. This indicates that Cintas has increasingly generated sufficient operating income to cover interest expenses multiple times over, suggesting a conservative financial structure with a comfortable margin of safety.
The trend of rising interest coverage ratios over the analyzed period underscores not only improved profitability and cash flow from operations but also a potential reduction in financial risk associated with interest payments. Overall, Cintas Corporation demonstrates a strong and growing ability to meet its interest obligations, supporting its financial stability and capacity for ongoing operational resilience.
Peer comparison
Feb 28, 2025