Stock Analysis on Net
Stock Analysis on Net

Cintas Corp. (NASDAQ:CTAS) 

DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin

Microsoft Excel

Decomposing ROE involves expressing net income divided by shareholders’ equity as the product of component ratios.

Two-Component Disaggregation of ROE

Cintas Corp., decomposition of ROE

Microsoft Excel
ROE = ROA × Financial Leverage
May 31, 2024 36.41% = 17.14% × 2.12
May 31, 2023 34.89% = 15.77% × 2.21
May 31, 2022 37.35% = 15.17% × 2.46
May 31, 2021 30.13% = 13.49% × 2.23
May 31, 2020 27.08% = 11.42% × 2.37
May 31, 2019 29.47% = 11.90% × 2.48

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 primary reason for the increase in return on equity ratio (ROE) over 2024 year is the increase in profitability measured by return on assets ratio (ROA).

Three-Component Disaggregation of ROE

Cintas Corp., decomposition of ROE

Microsoft Excel
ROE = Net Profit Margin × Asset Turnover × Financial Leverage
May 31, 2024 36.41% = 16.38% × 1.05 × 2.12
May 31, 2023 34.89% = 15.29% × 1.03 × 2.21
May 31, 2022 37.35% = 15.73% × 0.96 × 2.46
May 31, 2021 30.13% = 15.61% × 0.86 × 2.23
May 31, 2020 27.08% = 12.36% × 0.92 × 2.37
May 31, 2019 29.47% = 12.84% × 0.93 × 2.48

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 primary reason for the increase in return on equity ratio (ROE) over 2024 year is the increase in profitability measured by net profit margin ratio.

Five-Component Disaggregation of ROE

Cintas Corp., decomposition of ROE

Microsoft Excel
ROE = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover × Financial Leverage
May 31, 2024 36.41% = 0.80 × 0.95 × 21.62% × 1.05 × 2.12
May 31, 2023 34.89% = 0.80 × 0.94 × 20.47% × 1.03 × 2.21
May 31, 2022 37.35% = 0.82 × 0.94 × 20.21% × 0.96 × 2.46
May 31, 2021 30.13% = 0.86 × 0.93 × 19.48% × 0.86 × 2.23
May 31, 2020 27.08% = 0.83 × 0.91 × 16.42% × 0.92 × 2.37
May 31, 2019 29.47% = 0.80 × 0.92 × 17.50% × 0.93 × 2.48

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 primary reason for the increase in return on equity ratio (ROE) over 2024 year is the increase in operating profitability measured by EBIT margin ratio.

Two-Component Disaggregation of ROA

Cintas Corp., decomposition of ROA

Microsoft Excel
ROA = Net Profit Margin × Asset Turnover
May 31, 2024 17.14% = 16.38% × 1.05
May 31, 2023 15.77% = 15.29% × 1.03
May 31, 2022 15.17% = 15.73% × 0.96
May 31, 2021 13.49% = 15.61% × 0.86
May 31, 2020 11.42% = 12.36% × 0.92
May 31, 2019 11.90% = 12.84% × 0.93

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 primary reason for the increase in return on assets ratio (ROA) over 2024 year is the increase in profitability measured by net profit margin ratio.

Four-Component Disaggregation of ROA

Cintas Corp., decomposition of ROA

Microsoft Excel
ROA = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover
May 31, 2024 17.14% = 0.80 × 0.95 × 21.62% × 1.05
May 31, 2023 15.77% = 0.80 × 0.94 × 20.47% × 1.03
May 31, 2022 15.17% = 0.82 × 0.94 × 20.21% × 0.96
May 31, 2021 13.49% = 0.86 × 0.93 × 19.48% × 0.86
May 31, 2020 11.42% = 0.83 × 0.91 × 16.42% × 0.92
May 31, 2019 11.90% = 0.80 × 0.92 × 17.50% × 0.93

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 primary reason for the increase in return on assets ratio (ROA) over 2024 year is the increase in operating profitability measured by EBIT margin ratio.

Disaggregation of Net Profit Margin

Cintas Corp., decomposition of net profit margin ratio

Microsoft Excel
Net Profit Margin = Tax Burden × Interest Burden × EBIT Margin
May 31, 2024 16.38% = 0.80 × 0.95 × 21.62%
May 31, 2023 15.29% = 0.80 × 0.94 × 20.47%
May 31, 2022 15.73% = 0.82 × 0.94 × 20.21%
May 31, 2021 15.61% = 0.86 × 0.93 × 19.48%
May 31, 2020 12.36% = 0.83 × 0.91 × 16.42%
May 31, 2019 12.84% = 0.80 × 0.92 × 17.50%

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 primary reason for the increase in net profit margin ratio over 2024 year is the increase in operating profitability measured by EBIT margin ratio.