RBC Capital Upgrades Aramark Outlook to Outperform

A recent report highlights RBC Capital's upgrade of Aramark's outlook from Sector Perform to Outperform, suggesting a 3.73% potential upside. However, projected revenue is expected to decrease by 1.06%, alongside findings of mixed fund sentiment among major investors.

Date: 18-09-2024

AI Rating: 6

The report indicates that RBC Capital has upgraded Aramark's outlook to Outperform, which is a positive signal for investors. This upgrade suggests that analysts believe the stock will perform better than the broader market, which could lead to an increase in stock price due to enhanced investor confidence.

The analyst price forecast suggests a potential upside of 3.73%, with an average target price of 39.32 GBX/share compared to the latest closing price of 37.91 GBX/share. This price target indicates a slight positive outlook.

However, there are concerns regarding projected annual revenue, which is estimated to decrease by 1.06% to 19,744MM. A decrease in revenue often raises red flags, as it may signify declining sales or market challenges, possibly affecting future profitability.

Projected Non-GAAP EPS is reported at 2.49. This data is crucial for investors as the EPS can impact stock price appreciation if it meets or exceeds expectations. Overall, a higher EPS is generally viewed positively by investors.

The report mentions that sentiment among funds and institutions has been mixed, with 781 funds reporting positions in Aramark—a small increase of 1.69% in ownership. However, total shares owned by institutions increased by 9.40% to 335,043K shares, indicating a positive trend in institutional interest.

While some institutions like Capital International Investors and ABALX have decreased their shareholdings, others like Janus Henderson Group have increased their allocations significantly, revealing divergent views among major stakeholders.

Stocks: ARMK