NYSE:ARMK

Stock Analysis Report

Executive Summary

Aramark provides food, facilities management, and uniform services to education, healthcare, business and industry, sports, leisure, and corrections clients in North America and internationally.

Snowflake

Fundamentals

Acceptable track record with imperfect balance sheet.


Similar Companies

Share Price & News

How has Aramark's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

6.8%

NYSE:ARMK

-0.7%

US Hospitality

-1.6%

US Market


1 Year Return

-2.5%

NYSE:ARMK

-7.0%

US Hospitality

-3.0%

US Market

ARMK outperformed the Hospitality industry which returned -7% over the past year.

ARMK matched the United States of America Market (-3%) over the past year.


Share holder returns

ARMKIndustryMarket
7 Day6.8%-0.7%-1.6%
30 Day7.2%-7.6%-5.7%
90 Day25.6%-0.7%0.2%
1 Year-1.2%-2.5%-4.8%-7.0%-0.8%-3.0%
3 Year9.1%5.4%42.8%33.8%38.1%29.1%
5 Year62.1%53.1%31.5%17.1%50.8%34.1%

Price Volatility Vs. Market

How volatile is Aramark's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Aramark undervalued based on future cash flows and its price relative to the stock market?

4%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Aramark's share price is below the future cash flow value, but not at a moderate discount (< 20%).

Aramark's share price is below the future cash flow value, but not at a substantial discount (< 40%).


Price Based on Earnings

Aramark is good value based on earnings compared to the US Hospitality industry average.

Aramark is overvalued based on earnings compared to the United States of America market.


Price Based on Expected Growth

Aramark is poor value based on expected growth next year.


Price Based on Value of Assets

Aramark is overvalued based on assets compared to the US Hospitality industry average.


Next Steps

Future Growth

How is Aramark expected to perform in the next 1 to 3 years based on estimates from 12 analysts?

7.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Aramark's revenue is expected to grow by 2.9% yearly, however this is not considered high growth (20% yearly).

Aramark's earnings are expected to grow by 7.9% yearly, however this is not considered high growth (20% yearly).

Aramark's revenue growth is positive but not above the United States of America market average.

Aramark's earnings growth is positive but not above the United States of America market average.

Aramark's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Aramark is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has Aramark performed over the past 5 years?

25.7%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Aramark has delivered over 20% year on year earnings growth in the past 5 years.

Aramark's 1-year earnings growth is less than its 5-year average (6.5% vs 25.7%)

Aramark's earnings growth has exceeded the US Hospitality industry average in the past year (6.5% vs -8.7%).


Return on Equity

Aramark has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Aramark used its assets more efficiently than the US Hospitality industry average last year based on Return on Assets.


Return on Capital Employed

Aramark's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Aramark's financial position?


Financial Position Analysis

Aramark is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Aramark's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

Aramark's level of debt (216.8%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (328.5% vs 216.8% today).

Debt is not well covered by operating cash flow (15.5%, less than 20% of total debt).

Interest payments on debt are not well covered by earnings (EBIT is 2.6x annual interest expense, ideally 3x coverage).


Balance Sheet

Low level of unsold assets.

Debt is not covered by short term assets, assets are 0.4x debt.


Next Steps

Dividend

What is Aramark's current dividend yield, its reliability and sustainability?

1.23%

Expected Dividend Yield


Dividend Yield and Payments Analysis

Aramark's pays a lower dividend yield than the bottom 25% of dividend payers in United States of America (1.52%).

Aramark's dividend is below the markets top 25% of dividend payers in United States of America (3.93%).

Whilst dividend payments have been stable, Aramark has been paying a dividend for less than 10 years.

Dividend payments have increased, but Aramark only paid a dividend in the past 6 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (5x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be well covered by earnings (5.3x coverage).


Next Steps

Management

What is the CEO of Aramark's salary, the management and board of directors tenure and is there insider trading?

7.1yrs

Average management tenure


CEO

Eric Foss (61yo)

7.3yrs

Tenure

US$15,958,908

Compensation

Mr. Eric J. Foss has been the Chairman of the Board at Aramark since February 3, 2015 and as President and Chief Executive Officer since May 2012. He serves as the Chief Executive Officer and President of  ...


CEO Compensation Analysis

Eric's remuneration is higher than average for companies of similar size in United States of America.

Eric's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

7.1yrs

Average Tenure

52yo

Average Age

The average tenure for the Aramark management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

4.0yrs

Average Tenure

62yo

Average Age

The tenure for the Aramark board of directors is about average.


Insider Trading

Aramark individual insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$280,52716 Aug 19
Keith Bethel
EntityIndividual
Shares7,500
Max PriceUS$37.40
BuyUS$99,86514 Feb 19
Stephen Bramlage
EntityIndividual
Role
Chief Financial Officer
Executive VP
Shares3,195
Max PriceUS$31.26
BuyUS$196,32014 Dec 18
Stephen Sadove
EntityIndividual
Role
Lead Director
Lead Director
Shares6,000
Max PriceUS$32.72
BuyUS$3,004,18313 Dec 18
Eric Foss
EntityIndividual
Role
Chief Executive Officer
Chairman
Shares92,564
Max PriceUS$32.46
SellUS$619,96101 Sep 18
Stephen Reynolds
EntityIndividual
Shares15,000
Max PriceUS$41.33

Ownership Breakdown


Management Team

  • Eric Foss (61yo)

    Chairman

    • Tenure: 7.3yrs
    • Compensation: US$15.96m
  • David Ballarini

    Senior Vice President

    • Tenure: 10.9yrs
  • Felise Kissell

    Vice President of Investor Relations & Corporate Affairs

    • Tenure: 0.0yrs
  • Lynn McKee (64yo)

    Executive Vice President of Human Resources

    • Tenure: 15.3yrs
    • Compensation: US$2.91m
  • Joe Munnelly (55yo)

    Chief Accounting Officer (Leave of Absence)

    • Tenure: 11.9yrs
    • Compensation: US$2.00m
  • Brent Franks

    Chief Operating Officer of International

    • Tenure: 6.9yrs
  • Steve Bramlage (49yo)

    Executive VP

    • Tenure: 4.3yrs
    • Compensation: US$3.39m
  • Danna Vetter

    Chief Marketer

    • Tenure: 0.0yrs
  • Marc Bruno (47yo)

    Chief Operating Officer of Sports

    • Tenure: 4.6yrs
  • Lauren Harrington (43yo)

    Senior VP & General Counsel

    • Tenure: 0.4yrs

Board Members

  • Steve Sadove (67yo)

    Lead Director

    • Tenure: 0.6yrs
    • Compensation: US$300.66k
  • Rick Dreiling (66yo)

    Independent Director

    • Tenure: 3.5yrs
    • Compensation: US$260.01k
  • Baron Beckers-Vieujant (59yo)

    Independent Director

    • Tenure: 4.6yrs
    • Compensation: US$260.51k
  • Eric Foss (61yo)

    Chairman

    • Tenure: 7.3yrs
    • Compensation: US$15.96m
  • John Quelch (68yo)

    Independent Director

    • Tenure: 3.5yrs
    • Compensation: US$270.01k
  • Sanjeev Mehra (60yo)

    Lead Director

    • Tenure: 4.5yrs
    • Compensation: US$332.76k
  • Dan Heinrich (63yo)

    Independent Director

    • Tenure: 5.8yrs
    • Compensation: US$300.66k
  • Patty Morrison (60yo)

    Independent Director

    • Tenure: 2.5yrs
    • Compensation: US$270.01k
  • Irene Esteves (60yo)

    Independent Director

    • Tenure: 4.5yrs
    • Compensation: US$290.01k
  • Lisa Bisaccia (63yo)

    Independent Director

    • Tenure: 3.5yrs
    • Compensation: US$275.45k

Company Information

Aramark's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Aramark
  • Ticker: ARMK
  • Exchange: NYSE
  • Founded: 1959
  • Industry: Restaurants
  • Sector: Consumer Services
  • Market Cap: US$9.787b
  • Shares outstanding: 246.91m
  • Website: https://www.aramark.com

Number of Employees


Location

  • Aramark
  • 2400 Market Street
  • Philadelphia
  • Pennsylvania
  • 19103
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ARMKNYSE (New York Stock Exchange)YesCommon StockUSUSDDec 2013
0AKDB (Deutsche Boerse AG)YesCommon StockDEEURDec 2013
0HHBLSE (London Stock Exchange)YesCommon StockGBUSDDec 2013

Biography

Aramark provides food, facilities management, and uniform services to education, healthcare, business and industry, sports, leisure, and corrections clients in North America and internationally. It operate ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/25 00:46
End of Day Share Price2019/08/23 00:00
Earnings2019/06/28
Annual Earnings2018/09/28


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.