Price to FCFE (P/FCFE)
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Free Cash Flow to Equity (FCFE)
Cintas Corp., FCFE 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).
- Net Cash Provided by Operating Activities
-
The net cash provided by operating activities showed a consistent upward trend from May 31, 2019, through May 31, 2024. Starting at $1,067,862 thousand in 2019, there was a steady increase each year, reaching $2,079,781 thousand in 2024. This represents an approximate doubling of the cash inflows generated from operations over the five-year period. The data indicates strong cash generation capability and an improving operational efficiency or scale.
The growth was relatively moderate from 2019 to 2022, with values increasing from $1,067,862 thousand to $1,537,625 thousand. The increase accelerated after 2022, culminating in a significant jump to $2,079,781 thousand in 2024, suggesting possible operational improvements, increased revenues, or better cash collection practices during the latter years.
- Free Cash Flow to Equity (FCFE)
-
Free cash flow to equity exhibited more volatility compared to net operating cash flow. In 2019, FCFE was slightly above $1.1 million thousand, but it dropped sharply to $748,694 thousand in 2020, which could indicate increased capital expenditures, debt servicing, or other cash outflows during that year.
Following this dip, FCFE rebounded to $1,217,270 thousand in 2021 and continued to rise sharply to $1,548,659 thousand in 2022. However, in 2023, a noticeable decline occurred, with FCFE falling to $955,505 thousand before recovering again to $1,656,862 thousand in 2024. This pattern suggests variability in factors affecting equity cash flow, such as investments, financing activities, or working capital changes.
Overall, despite the fluctuations, the five-year span ended with an FCFE value significantly higher than the lowest point, indicating a recovery and strengthening of free cash flow available to shareholders by 2024.
Price to FCFE Ratio, Current
Cintas Corp., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in thousands) | |
| FCFE per share | |
| Current share price (P) | |
| Valuation Ratio | |
| P/FCFE | |
| Benchmarks | |
| P/FCFE, Industry | |
| Industrials | |
Based on: 10-K (reporting date: 2024-05-31).
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Cintas Corp., historical P/FCFE 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).
1 Data adjusted for splits and stock dividends.
3 2024 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= ÷ =
4 Closing price as at the filing date of Cintas Corp. Annual Report.
5 2024 Calculation
P/FCFE = Share price ÷ FCFE per share
= ÷ =
- Share Price Trend
- The share price exhibited a consistent upward trajectory from May 31, 2019, to May 31, 2024. Beginning at $65.42 in 2019, there was a notable increase each year, culminating in a peak value of $188.71 in 2024. This reflects strong market confidence and robust valuation growth over the six-year period.
- FCFE per Share Trend
- The Free Cash Flow to Equity (FCFE) per share showed some variability over the years. It started at $2.69 in 2019, declined to $1.81 in 2020, and then rebounded significantly to $3.83 in 2022. However, it dropped again to $2.35 in 2023 before rising to $4.11 in 2024. This pattern indicates fluctuating cash flow generation capacity, with overall improvement by the end of the period.
- P/FCFE Ratio Trend
- The Price to FCFE ratio demonstrated considerable volatility. After a starting ratio of 24.3 in 2019, it spiked sharply to 42.27 in 2020, then gradually decreased to 26.74 in 2022. In 2023, the ratio reached its highest point of 53.73 before slightly declining to 45.91 in 2024. These fluctuations suggest varying market expectations relative to free cash flow generation, potentially reflecting changes in investor sentiment or risk perceptions.
- Interpretation of Relationship Between Variables
- The steady increase in share price despite fluctuations in FCFE per share indicates that market valuation may have been influenced by factors beyond immediate cash flow performance, such as growth prospects or macroeconomic conditions. The high and variable P/FCFE ratios imply that investors have at times been willing to pay a premium relative to free cash flow, which might indicate optimism about future cash flows or general market exuberance. The decline in FCFE per share in 2023, concurrent with a peak in the P/FCFE ratio, points to a divergence between operational cash flow and market valuation at that time.