Cintas's expanded share repurchase program signals confidence, UBS says

[South Melbourne Market, Melbourne , Australia]
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Cintas (CTAS [https://seekingalpha.com/symbol/CTAS]) this week increased its share repurchase authorization by $1 billion, bringing the total to $1.7 billion, a move analysts at UBS said signals confidence in the company’s cash generation and outlook.

According to an October 28 note from UBS analyst Joshua Chan, the updated authorization suggests Cintas (CTAS [https://seekingalpha.com/symbol/CTAS]) has been actively buying back stock during its fiscal second quarter, with total repurchases potentially reaching about $400 million so far this quarter. That would mark one of the company’s largest quarterly buyback totals on record, surpassing the $266 million it repurchased in the first quarter.

Chan said buybacks have been “relatively steady throughout the quarter,” with roughly $222 million repurchased between September 1 and October 8, and the remaining amount bought since October 9. The pace, he added, is well ahead of UBS’s prior estimate of $87 million in quarterly buybacks.

Cintas (CTAS [https://seekingalpha.com/symbol/CTAS]), best known for its uniform rental and facility services business, has historically returned capital to shareholders through both buybacks and dividends. The expanded authorization, Chan noted, reflects management’s confidence in near-term cash flow, supported by stable customer demand and pricing power.

UBS has a Buy rating on Cintas (CTAS [https://seekingalpha.com/symbol/CTAS]), highlighting that the company’s repurchase activity underscores a strong balance sheet and disciplined capital allocation ahead of its next earnings release.

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