Cintas Corporation (CTAS)
Solvency ratios
| May 31, 2025 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 2.10 | 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 |
The analysis of Cintas Corporation's solvency ratios over the provided period reveals several noteworthy points regarding its financial stability and leverage profile.
Debt-to-assets, debt-to-capital, and debt-to-equity ratios consistently report a value of zero across all dates from August 2020 through May 2025. This persistent zero value strongly indicates that the company has maintained either negligible or nonexistent levels of debt during these periods. Such a profile suggests that Cintas has primarily funded its operations through internal measures, such as retained earnings or equity financing, without reliance on external debt sources.
Financial leverage ratio, which measures the proportion of assets financed through debt relative to equity, demonstrates variation but remains within a moderate range. It starts at approximately 2.23 in August 2020 and exhibits fluctuations over time, peaking at 2.56 in August 2022. Subsequently, it shows a gradual decline, reaching approximately 2.09 by May 2025. The consistent ratio above 2 indicates that, when present, Cintas utilizes a combination of debt and equity financing, but the overall ratios suggest conservative leverage practices, especially given the near-zero debt ratios.
Collectively, these ratios depict a company with an exceptionally low reliance on debt financing. The zero debt-to-assets, debt-to-capital, and debt-to-equity ratios imply that Cintas predominantly operates without significant leverage, thereby reducing financial risk associated with debt obligations. The moderate and relatively stable financial leverage ratios, despite the absence of debt, may reflect internal asset management efficiencies or the use of other non-debt liabilities not captured within these particular ratios.
In summary, Cintas Corporation exhibits a conservative capital structure characterized by negligible or no debt, complemented by moderate leverage ratios. This financial positioning suggests a strategic emphasis on maintaining low financial risk, likely supporting a stable operational profile with minimal exposure to debt-related insolvency concerns.
Coverage ratios
| May 31, 2025 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 17.50 | 22.96 | 21.91 | 21.05 | 20.66 | 19.52 | 18.19 | 17.27 | 16.22 | 16.01 | 16.69 | 17.25 | 17.88 | 17.05 | 15.71 | 14.98 | 14.11 | 12.42 | 12.13 | 11.75 |
The interest coverage ratios for Cintas Corporation over the specified periods demonstrate a generally robust capacity to meet interest obligations. Starting from a ratio of approximately 11.75x as of August 31, 2020, the ratio increased steadily over the subsequent quarters, reaching a peak of around 22.96x on February 28, 2025.
This upward trend indicates a strengthening in the company's ability to generate earnings sufficient to cover interest expenses, suggesting improved operational profitability or favorable changes in earnings before interest and taxes (EBIT). The ratios have shown consistent growth with only minor fluctuations, which underscores a stable and increasingly resilient interest coverage position.
The ratios staying well above a commonly comfortable threshold of 3 to 4 times suggest that Cintas maintains a strong financial cushion to meet its interest obligations, thereby reducing financial risk. The gradual increase in interest coverage ratio signifies an ongoing improvement in financial health, likely driven by enhanced profitability or efficient cost management strategies.
In summary, Cintas Corporation’s interest coverage ratios depict a positive financial trajectory with a comfortable margin above typical risk levels, reflecting prudent financial management and operational strength.