Atento (NYSE: ATTO) and Cintas (NASDAQ:CTAS) are both business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, risk, profitability and valuation.
Atento pays an annual dividend of $0.34 per share and has a dividend yield of 3.5%. Cintas pays an annual dividend of $1.62 per share and has a dividend yield of 1.0%. Atento pays out 242.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cintas pays out 32.3% of its earnings in the form of a dividend. Atento has increased its dividend for 34 consecutive years. Atento is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Institutional & Insider Ownership
94.7% of Atento shares are held by institutional investors. Comparatively, 66.8% of Cintas shares are held by institutional investors. 18.9% of Cintas shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This table compares Atento and Cintas’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility and Risk
Atento has a beta of -0.07, indicating that its share price is 107% less volatile than the S&P 500. Comparatively, Cintas has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.
This is a summary of recent ratings and price targets for Atento and Cintas, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Atento presently has a consensus price target of $14.67, indicating a potential upside of 48.90%. Cintas has a consensus price target of $151.10, indicating a potential downside of 6.25%. Given Atento’s stronger consensus rating and higher possible upside, equities analysts plainly believe Atento is more favorable than Cintas.
Earnings and Valuation
This table compares Atento and Cintas’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Cintas||$5.32 billion||3.22||$480.70 million||$5.02||32.11|
Cintas has higher revenue and earnings than Atento. Cintas is trading at a lower price-to-earnings ratio than Atento, indicating that it is currently the more affordable of the two stocks.
Cintas beats Atento on 11 of the 17 factors compared between the two stocks.
Atento S.A. is a provider of customer-relationship management and business-process outsourcing (CRM BPO) services and solutions in Latin America. The Company offers a portfolio of CRM BPO services, including customer care, sales, collections, back office and technical support. The Company operates through three segments: EMEA, Americas and Brazil. Its services and solutions are delivered across multiple channels including digital (short message service (SMS), e-mail, chats, social media and applications, among others) and voice, and are enabled by process design, technology and intelligence functions. The Company also has client relationships across a range of industries working in sectors, such as telecommunications, banking and financial services and multi-sector, which comprise the consumer goods, services, public administration, pay television, healthcare, transportation, technology and media industries.
Cintas Corporation is a provider of corporate identity uniforms through rental and sales programs, as well as a provider of related business services, including entrance mats, restroom cleaning services and supplies, carpet and tile cleaning services, first aid and safety services and fire protection products and services. Its segments include uniform rental and facility services, and first aid and safety services. Its uniform rental and facility service segment offers services, which include rental and servicing of uniforms and other garments, including flame resistant clothing, mats, mops and shop towels, and other ancillary items. Its first aid and safety service segment offers services, which include first aid and safety products and services. Rental processing plants, rental branches, first aid and safety facilities, fire protection facilities, direct sales offices, distribution centers and manufacturing facilities are all utilized by the businesses included in All Other.
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