The Jensen Quality Growth Investment Team added Cintas Corporation (ticker: CTAS) to the Quality Growth Strategy with an initial weighting of 1.5%. As of May 31, 2026, the Strategy had 27 holdings.
May 2026
Company Overview
Cintas Corporation was founded in 1929 and is headquartered in Mason, Ohio. The company provides over one million U.S. and Canadian businesses with rental and laundry services for employee uniforms, as well as floor mats, mops, restroom supplies, fire protection, and first aid services. Cintas’ current CEO is Todd Schneider, who joined in 1989 and has been CEO since 2021. Cintas is the largest competitor in its industry and is in the process of acquiring the third-largest company, UniFirst (UNF).
What Led Us to Buy Cintas
Our thesis for Cintas is driven by the company’s strong business fundamentals and their alignment with key tenets of the Jensen Quality Growth Strategy’s investment selection process:
- Competitive Advantages: Cintas benefits from economies of scale, with three times the market share of the next largest competitor in an industry where scale provides significant benefits to profit margins by leveraging fixed assets and maximizing route density. Additionally, the company benefits from a strong brand and moderate barriers to entry at a profitable scale, driven by startup capital requirements.
- Earnings Stability: While Cintas is exposed to economic cycles and more specifically employment rates, the company benefits from high customer retention rates, and its historical results have been much less volatile than the broader market or its stock price might suggest. Additionally, the company benefits from high returns on capital and a strong balance sheet with little debt.
- Valuation: After weak performance of CTAS stock in 2026 as investors rotated towards more cyclical technology companies, we saw an opportunity to establish a position in the Strategy.
Why Now
We saw an opportunity to establish a position in Cintas and upgrade the quality of the businesses in our Strategy, based on the company’s fundamentals and valuation at the time.
Outlook
In the near term, we expect solid results from Cintas despite macroeconomic headwinds driven by high fuel prices. Over the long term, we expect Cintas to continue to generate solid revenue and earnings growth, driving strong returns on capital well above its capital costs, which we believe will create compounding value for shareholders over time.
Strategy holdings are subject to change and should not be considered recommendations to buy or sell any security. Please click here for a listing of the Quality Growth Strategy’s current holdings.
The company discussion is solely intended to illustrate the application of our investment approach and is not to be considered a recommendation by Jensen. The specific security identified is taken from a representative account of the Jensen Quality Growth Strategy and does not represent all of the securities purchased and sold for the Strategy. Our views expressed herein are subject to change and should not be construed as a recommendation or offer to buy or sell any security and are not designed or intended as a basis or determination for making any investment decision for any security. Our discussions should not be construed as an indication that an investment in a security has been or will be profitable, or that the investment recommendations or decisions we make in the future will be profitable or will equal the investment performance of any security discussed herein.
Certain information contained in this material represents or is based upon forward-looking statements, which can be identified by the use of terminology such as “may,” “will,” “should,” “expect,” “anticipate,” “target,” “project,” “estimate,” “intend,” “continue” or “believe” or the negatives thereof or other variations thereon or comparable terminology. Due to various risks and uncertainties, actual events or results or the actual performance of a client account may differ materially from those reflected or contemplated in such forward-looking statements.
This information is current as of the date of this material and is subject to change at any time, based on market and other conditions.
Jensen Investment Management, Inc., is an investment adviser registered under the Investment Advisers Act of 1940. Registration with the SEC does not imply any level of skill or training. Although taken from reliable sources, Jensen cannot guarantee the accuracy of the information received from third parties.
© 2026 Jensen Investment Management
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