Aramark Q1 revenue, profit beat expectations

Overview

• Food services provider's Q1 revenue grew 6%, beating analyst expectations

• Adjusted EPS for Q1 beat analyst expectations

• Company repurchased $30 mln of stock and repriced $2.4 bln term loans

Outlook

• Aramark expects fiscal 2026 revenue between $19.55 bln and $19.95 bln

• Company anticipates adjusted EPS growth of 20% to 25% in fiscal 2026

• Aramark aims to reduce leverage ratio to under 3x by end of fiscal 2026

Result Drivers

• CALENDAR SHIFT IMPACT - Revenue, operating income, and EPS growth were reduced by a calendar shift from the 53rd week in fiscal 2025

• BASE BUSINESS EXPANSION - Revenue growth driven by base business expansion and net new business

• TECHNOLOGY AND EFFICIENCIES - Profitability benefited from higher revenue levels, supply chain efficiencies, and organizational cost discipline

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 13 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the restaurants & bars peer group is "buy"

• Wall Street's median 12-month price target for Aramark is $45.00, about 16% above its February 9 closing price of $38.80

• The stock recently traded at 17 times the next 12-month earnings vs. a P/E of 17 three months ago

Press Release: ID:nBw8B7rTga

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.