CINTAS CORP. $38 - Nasdaq symbol CTAS

CINTAS CORP. $38 (Nasdaq symbol CTAS; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 126.5 million; Market cap: $4.8 billion; Price-to-sales ratio: 1.2; Dividend yield: 1.4%; TSINetwork Rating: Average; www.cintas.com) earned $297.6 million in its 2012 fiscal year, which ended May 31, 2012. That’s up 20.5% from $247.0 million in 2011. Earnings per share jumped 35.1%, to $2.27 from $1.68, on fewer shares outstanding.

Revenue rose 7.7% in 2012, to a record $4.1 billion from $3.8 billion. If you exclude contributions from acquisitions, revenue still rose 6.1%.

The company continues to see rising demand for the uniforms and services, such as document shredding, that it sells to businesses. It is also doing a good job of controlling its costs.

Even with the U.S. economy’s uncertain outlook, Cintas expects its earnings to rise to $2.53 a share in fiscal 2013. The stock trades at a reasonable 15.0 times that forecast.

Cintas is a buy.

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Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.

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One of the sweetest and most profitable pleasures of successful investing is to buy high-quality “value stocks” (or stocks that are reasonably priced, if not cheap, in relation to its sales, earnings or assets), then hold on to them as mainstream investors recognize the value and push up the share price.

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