PVH (NYSE: PVH) and Cintas (NASDAQ:CTAS) are both large-cap consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, institutional ownership, risk, valuation, profitability and analyst recommendations.

Dividends

PVH pays an annual dividend of $0.15 per share and has a dividend yield of 0.1%. Cintas pays an annual dividend of $1.62 per share and has a dividend yield of 0.9%. PVH pays out 1.9% of its earnings in the form of a dividend. Cintas pays out 35.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Cintas has raised its dividend for 35 consecutive years. Cintas is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares PVH and Cintas’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PVH 6.03% 12.03% 5.44%
Cintas 11.69% 22.86% 8.54%

Analyst Recommendations

This is a summary of current recommendations and price targets for PVH and Cintas, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PVH 0 4 14 0 2.78
Cintas 1 6 5 1 2.46

PVH presently has a consensus price target of $158.33, indicating a potential downside of 1.36%. Cintas has a consensus price target of $166.10, indicating a potential downside of 4.16%. Given PVH’s stronger consensus rating and higher probable upside, research analysts plainly believe PVH is more favorable than Cintas.

Insider and Institutional Ownership

96.3% of PVH shares are owned by institutional investors. Comparatively, 66.2% of Cintas shares are owned by institutional investors. 1.3% of PVH shares are owned by insiders. Comparatively, 18.9% of Cintas shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares PVH and Cintas’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PVH $8.91 billion 1.39 $537.80 million $7.94 20.22
Cintas $5.32 billion 3.47 $480.70 million $4.53 38.26

PVH has higher revenue and earnings than Cintas. PVH is trading at a lower price-to-earnings ratio than Cintas, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

PVH has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500. Comparatively, Cintas has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500.

Summary

Cintas beats PVH on 10 of the 18 factors compared between the two stocks.

PVH Company Profile

PVH Corp. operates as an apparel company in North America and internationally. The company operates through six segments: Calvin Klein North America, Calvin Klein International, Tommy Hilfiger North America, Tommy Hilfiger International, Heritage Brands Wholesale, and Heritage Brands Retail. It designs, markets, and retails men's and women's apparel and accessories, including branded dress shirts, dresses, suits, neckwear, sportswear, jeans wear, performance and intimate apparel, underwear, swimwear, swim products, handbags, luggage products, footwear, golf apparel, sleepwear and loungewear, eyewear and fragrances, cosmetics, skincare products and toiletries, socks and tights, jewelry, watches, outerwear, small leather goods, and furnishings, as well as other related products. The company offers its products under its own brands, such as Calvin Klein, Tommy Hilfiger, Van Heusen, IZOD, ARROW, Warner's, Olga, Eagle, and True&Co.; and licensed brands comprising Speedo, Geoffrey Beene, Kenneth Cole New York, Kenneth Cole Reaction, MICHAEL Michael Kors, Michael Kors Collection, DKNY, and Chaps, as well as various other licensed and private label brands. It also licenses its own brands over various products. The company distributes its products at wholesale in department, chain, and specialty stores, as well as through warehouse clubs, mass market and off-price retailers, and independent retailers; and through company-operated full-price specialty and outlet stores, as well as through digital commerce sites. PVH Corp. was founded in 1881 and is based in New York, New York.

Cintas Company Profile

Cintas Corporation provides corporate identity uniforms and related business services primarily in North America, Latin America, Europe, and Asia. It operates through Uniform Rental and Facility Services; First Aid and Safety Services; and All Other segments. The company rents and services uniforms and other garments, including flame resistant clothing, mats, mops and shop towels, and other ancillary items; and provides restroom cleaning services and supplies, and carpet and tile cleaning services, as well as sells uniforms directly. It also offers first aid and safety services, and fire protection products and services. The company offers its products and services through its distribution network and local delivery routes, or local representatives to small service and manufacturing companies, as well as major corporations. Cintas Corporation was founded in 1968 and is based in Cincinnati, Ohio.

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