Enterprise Value to EBITDA (EV/EBITDA)
Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
Cintas Corp., EBITDA calculation
US$ in thousands
Based on: 10-K (reporting date: 2024-05-31), 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31).
The financial data displays a consistent upward trend across all major profitability metrics over the six-year period examined.
- Net Income
- Net income increased steadily from $884,981 thousand in 2019 to $1,571,592 thousand in 2024. This represents an overall growth of approximately 77.6% over the period, with each year showing a positive increase, reflecting strong profitability improvements.
- Earnings Before Tax (EBT)
- EBT also demonstrated a consistent rise from $1,102,399 thousand in 2019 to $1,973,635 thousand in 2024. The growth rate approximates 79%, indicating enhanced earnings efficiency before tax obligations and an improving earnings base.
- Earnings Before Interest and Tax (EBIT)
- EBIT grew steadily from $1,204,135 thousand in 2019 to $2,074,375 thousand in 2024, marking an increase of about 72.3%. This growth highlights effective management of operational costs relative to revenues, contributing to expanding operating profitability.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
- EBITDA rose from $1,564,228 thousand in 2019 to $2,516,759 thousand in 2024, reflecting a 60.9% increase. This progression indicates ongoing improvement in cash-based operational performance, showing a strong ability to generate earnings before accounting for non-cash charges.
Overall, the upward trends across these key profitability measures suggest consistent operational and financial performance improvements over the period. No irregularities or downturns are apparent, revealing stable growth in earnings capacity and effective cost control throughout the years analyzed.
Enterprise Value to EBITDA Ratio, Current
Cintas Corp., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | 79,876,250) |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | 2,516,759) |
| Valuation Ratio | |
| EV/EBITDA | 31.74 |
| Benchmarks | |
| EV/EBITDA, Industry | |
| Industrials | 20.26 |
Based on: 10-K (reporting date: 2024-05-31).
If the company EV/EBITDA is lower then the EV/EBITDA of benchmark then company is relatively undervalued.
Otherwise, if the company EV/EBITDA is higher then the EV/EBITDA of benchmark then company is relatively overvalued.
Enterprise Value to EBITDA Ratio, Historical
Cintas Corp., historical EV/EBITDA calculation, comparison to benchmarks
Based on: 10-K (reporting date: 2024-05-31), 10-K (reporting date: 2023-05-31), 10-K (reporting date: 2022-05-31), 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31).
3 2024 Calculation
EV/EBITDA = EV ÷ EBITDA
= 78,197,934 ÷ 2,516,759 = 31.07
- Enterprise Value (EV)
- The enterprise value demonstrated a consistent upward trajectory over the examined periods. Beginning at approximately $29.6 billion in May 2019, it increased steadily each year, reaching nearly $78.2 billion by May 2024. This progression indicates a substantial growth in the company's market valuation, with particularly notable acceleration observed between May 2023 and May 2024.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
- The EBITDA showed a general increasing trend throughout the years, rising from roughly $1.56 billion in May 2019 to about $2.52 billion in May 2024. Despite minor fluctuations, including a slight decrease from May 2019 to May 2020, the overall growth signifies improved operational profitability and cash flow generation capacity over the timeframe.
- EV/EBITDA Ratio
- The EV/EBITDA ratio exhibited an upward trend, starting at 18.91 in May 2019 and reaching 31.07 by May 2024. This increasing ratio suggests that the enterprise value is growing at a faster pace compared to EBITDA, potentially indicating heightened market expectations or valuation multiples. The ratio maintained a relatively steady increase, with a slight dip in May 2022, before accelerating significantly in the final year reported.
- Summary of Trends
- The data reflects strong growth in both company valuation and earnings from operations over the six-year period. However, the sharp increase in the EV/EBITDA ratio towards the end of the period may suggest rising investor optimism or market conditions leading to higher valuation multiples. Continuous growth in EBITDA alongside rising enterprise value indicates improving business performance, though the expanding EV/EBITDA ratio warrants monitoring for potential overvaluation or changes in market sentiment.