Cintas Corporation (CTAS)
Solvency ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 2.09 | 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 |
The analysis of Cintas Corporation's solvency ratios, based on the provided data, indicates a stable financial position with respect to leverage and minimal use of debt relative to assets and capital.
Specifically, the Debt-to-Assets Ratio consistently remains at 0.00 across all observed dates, suggesting that the company's total liabilities are negligible or that the disclosures relate solely to equity-financed operations. This pattern indicates that Cintas has not relied on debt financing during the period analyzed, or that debt levels are so minimal they are effectively immaterial in relation to total assets.
Similarly, the Debt-to-Capital Ratio and Debt-to-Equity Ratio are both reported as 0.00 throughout the entire timeline. This reinforces the observation that the company maintains an equity-financed capital structure with no apparent reliance on external debt sources, and it does not employ leverage in its capital structure.
In contrast, the Financial Leverage Ratio, which measures the extent of financial leverage relative to equity, displays variability over the period but generally remains below 2.5. Starting at 2.37 in May 2020, it fluctuates slightly, reaching a peak of 2.56 in August 2022, and then gradually declining to approximately 2.09 by February 2025. This ratio indicates the firm’s use of operational or financial leverage is moderate and stable, reflecting a conservative approach to debt usage or a strong reliance on internal financing.
Overall, the absence of debt and the consistent leverage ratio suggest that Cintas Corporation maintains a highly solvent, low-risk capital structure characterized by minimal leveraging. The firm’s financial position appears robust, with negligible debt-related risks, aligning with a prudent and potentially conservative financial strategy aimed at preserving liquidity and financial flexibility.
Coverage ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 |
The interest coverage ratio for Cintas Corporation over the specified period demonstrates a consistent and generally improving ability to meet its interest obligations through its operating earnings. Starting from a ratio of 7.43 on May 31, 2020, the ratio experienced a steady upward trajectory, reaching 8.06 by August 31, 2020, and further increasing to 8.37 by November 30, 2020. This indicates that the company's earnings exceeded its interest expenses by approximately 7.4 to 8.4 times during this early period.
Throughout 2021, the ratio continued to grow, surpassing the double-digit mark: reaching 10.17 on May 31, 2021, and climbing to 11.54 by November 30, 2021. The trend persisted into 2022, with the ratio reaching 12.76 in February and escalating significantly to 17.88 by May and remaining strong through subsequent quarters, ending at 16.69 on November 30, 2022.
From late 2022 onward, the interest coverage ratio maintained elevated levels, signifying a solid capacity to cover interest payments. It was recorded at 16.01 on February 28, 2023, then slightly higher at 16.22 on May 31, 2023. During the latter part of 2023 and into early 2024, ratios remained robust: 17.27 in August 2023, 18.19 in November 2023, and further to 19.52 in February 2024.
Projections for the subsequent periods suggest ongoing strong coverage, with ratios anticipated to continue increasing, reaching 20.66 in May 2024, 21.05 in August 2024, and 21.91 in November 2024. The data implies that Cintas has maintained a historically high ratio of operating income to interest expense, indicating a resilient financial position with ample earnings to service interest obligations comfortably.
Overall, the trend shows a consistent improvement in interest coverage over the analyzed period, reflecting enhanced profitability, effective financial management, or both. A ratio well above 3 to 4 times generally indicates low risk of default on interest payments, and Cintas’s ratios substantially exceed this benchmark, reinforcing its strong financial stability concerning interest expense coverage.