To The Moon

$UniFirst(UNF)$ is scheduled to release its Fiscal 2025 Third Quarter results before the market opens on 02 July 2025, with a conference call following at 9:00 a.m. Eastern Time.

Earnings Per Share (EPS): Analysts will have consensus estimates for Q3 2025 EPS. In Q2 2025, UniFirst reported an EPS of $1.31, missing the consensus estimate of $1.34. Investors will be keen to see if the company can meet or beat expectations for Q3, especially given the prior quarter's miss. Some estimates for Q3 2025 EPS are around $2.09.

Revenue Growth: UniFirst (UNF) operates in the uniform and workwear, facility services, and safety supplies industry. This sector is generally tied to employment levels and overall economic activity. Investors will be looking for continued organic growth in revenue, driven by new customer acquisition and existing customer retention. The previous Q2 2025 results showed revenue of $602.20M, which was slightly below estimates.

UniFirst (UNF) Last Positive Earnings Call Saw Share Price Gained By 6.44%

UniFirst had a positive earnings call on 02 April 2025 which saw its share price gained by 6.44% since.

The earnings call presented a largely positive outlook with significant improvements in revenue, profitability, and cash flow. Customer retention and new business installations showed positive trends, along with strategic investments and expansions. However, there were challenges such as declining net wearer levels, higher health care costs, and reduced margins in the specialty garment segment.

UniFirst (UNF) Guidance

During the UniFirst Second Quarter 2025 Earnings Conference Call, the company provided guidance reflecting a positive trajectory in several financial metrics. UniFirst reported consolidated revenues of $602.2 million, marking a 1.9% increase from fiscal 2024, with organic growth at 2.3%. Operating income rose significantly by 11.7%, reaching $31.2 million, while adjusted EBITDA improved by 6.3% to $68.9 million, compared to the same quarter last year.

The company also noted a 20.2% increase in operating cash flow year-to-date. For the full fiscal year 2025, UniFirst anticipates revenues between $2.422 billion and $2.432 billion, and diluted earnings per share (EPS) ranging from $7.30 to $7.70. This outlook reflects ongoing improvements in core laundry operations and an updated assumption of $12 million in key initiative costs, slightly revised down from prior estimates.

What to Expect (Based on Past Performance and Analyst Estimates)

Profit Margins: Look at the company's operating profit margin and net income margin. These indicate how efficiently UniFirst is converting revenue into profit. Factors like labor costs, material costs, and pricing power will influence these margins.

Segment Performance: UniFirst typically reports across segments (e.g., Uniform and Workwear, Specialty Garments). Investors should pay attention to which segments are driving growth or facing challenges.

Outlook for Q4 and Fiscal Year 2025: The most crucial part of the earnings call will likely be management's updated guidance for the upcoming quarter (Q4 Fiscal 2025) and the full fiscal year 2025. This guidance will provide insights into their expectations for demand, pricing, and operational efficiency.

Share Repurchase and Dividends: UniFirst has a history of returning capital to shareholders through share repurchases and dividends. They recently authorized a new $100 million share repurchase program in April 2025. Investors will want to see if the buyback program is actively being utilized and if dividend policies remain consistent.

M&A Activity: Management may provide updates on their appetite for mergers and acquisitions, as they have historically pursued strategic acquisitions to expand their market reach.

Key Themes to Listen for in the Earnings Call

Economic Headwinds/Tailwinds: How is the current economic environment (e.g., inflation, labor market, industrial activity) impacting UniFirst's business?

Pricing Environment: Are they able to pass on increased costs to customers through price adjustments?

Customer Retention and New Business: What are the trends in customer churn and new account wins?

Operational Efficiency: Are there any initiatives to improve efficiency or reduce costs?

Supply Chain: Are there any ongoing supply chain challenges affecting their operations or costs?

Impact of Technology/Digitalization: How are they leveraging technology to enhance services or improve operations?

Analyst Sentiment (Pre-Earnings)

Based on recent data, analyst ratings for UNF have been somewhat mixed, with some showing "Underweight" ratings from firms like Barclays (as of April 4, 2025). However, some estimates for the next quarter (Q4 2025) show expected EPS growth. It's important to note that analyst consensus ratings for UNF appear to be "Neutral" as of the latest available data, with 0 "Buy," 0 "Hold," and 1 "Sell" rating from the last 3 months.

Investor Implications

Neutral-to-Cautious Outlook: While Q3 was solid, the lowered full-year guidance may cap near-term upside.

Dividend Stability: UniFirst remains a reliable dividend payer — attractive for income-focused portfolios.

Watch for Margin Trends: With labor and fuel costs fluctuating, future quarters may hinge on operational efficiency

Valuation Snapshot

The valuation is elevated for a slow-growth industrial, suggesting investors are pricing in margin stability and long-term contract durability.

UniFirst (UNF) Price Target

Based on 4 analysts from Tiger Brokers offering 12 month price targets for UniFirst in the last 3 months. The average price target is $179.25 with a high forecast of $197.00 and a low forecast of $152.00. The average price target represents a -3.79% change from the last price of $186.32.

Investor Implications

Neutral-to-Cautious Outlook: While Q3 was solid, the lowered full-year guidance may cap near-term upside.

Dividend Stability: UniFirst remains a reliable dividend payer — attractive for income-focused portfolios.

Watch for Margin Trends: With labor and fuel costs fluctuating, future quarters may hinge on operational efficiency.

Technical Analysis - Exponential Moving Average (EMA)

We are seeing UNF trading sideways in a consolidated movement, this could indicate investors are adopting a “wait and see” attitude for the earnings, if earnings were to come in positive or even beat estimates, that could create a gap up or surge.

But I think investors might still be holding onto UNF for dividend play, though the RSI momentum is showing negative sign, and the share price is near the short-term and long-term period, but the bulls are having a hard time defending this level, as we are seeing some downside move along the 26-EMA.

Hence if you are into dividend play, this might be a chance to look at this stock and analyse the potential, I am not much into this stock, but I think they might have a chance to beat the estimates.

Summary

For UniFirst Corporation (UNF) Q3 2025 earnings, the most critical aspect for investors will be the actual reported figures compared to analyst estimates, and more importantly, the forward-looking guidance provided by management. This guidance will be a strong indicator of the company's confidence in its performance for the remainder of the fiscal year and beyond.

So it is important to understand how the management would be forecasting their future performance, which could give a glimpse of the magnitude of the dividends UNF would be giving.

Appreciate if you could share your thoughts in the comment section whether you think UNF could beat estimates and provide a positive guidance which should drive more investors confidence and interest.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.