ARAMARK (ARMK) Stock Fundamental Analysis
NYSE:ARMK - New York Stock Exchange, Inc. - US03852U1060 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to ARMK. ARMK was compared to 133 industry peers in the Hotels, Restaurants & Leisure industry. ARMK has only an average score on both its financial health and profitability. ARMK has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year ARMK was profitable.
In the past year ARMK had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: ARMK reported negative net income in multiple years.
In the past 5 years ARMK always reported a positive cash flow from operatings.
1.2 Ratios
ARMK has a Return On Assets (2.58%) which is comparable to the rest of the industry.
Looking at the Return On Equity, with a value of 11.52%, ARMK is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
ARMK has a Return On Invested Capital (5.66%) which is in line with its industry peers.
The Average Return On Invested Capital over the past 3 years for ARMK is significantly below the industry average of 13.97%.
The 3 year average ROIC (4.93%) for ARMK is below the current ROIC(5.66%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.58% | ||
| ROE | 11.52% | ||
| ROIC | 5.66% |
ROA(3y)2.45%
ROA(5y)0.76%
ROE(3y)11.07%
ROE(5y)2.59%
ROIC(3y)4.93%
ROIC(5y)N/A
1.3 Margins
ARMK has a Profit Margin (1.97%) which is in line with its industry peers.
ARMK's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 4.38%, ARMK is doing worse than 66.17% of the companies in the same industry.
In the last couple of years the Operating Margin of ARMK has remained more or less at the same level.
With a Gross Margin value of 8.47%, ARMK is not doing good in the industry: 91.73% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of ARMK has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.38% | ||
| PM (TTM) | 1.97% | ||
| GM | 8.47% |
OM growth 3Y40.47%
OM growth 5Y-1.21%
PM growth 3YN/A
PM growth 5Y-11.42%
GM growth 3Y5.79%
GM growth 5Y8.33%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ARMK is destroying value.
Compared to 1 year ago, ARMK has more shares outstanding
The number of shares outstanding for ARMK has been increased compared to 5 years ago.
The debt/assets ratio for ARMK has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.18 indicates that ARMK is not a great score, but indicates only limited risk for bankruptcy at the moment.
ARMK has a Altman-Z score of 2.18. This is in the better half of the industry: ARMK outperforms 63.16% of its industry peers.
ARMK has a debt to FCF ratio of 17.61. This is a negative value and a sign of low solvency as ARMK would need 17.61 years to pay back of all of its debts.
ARMK has a Debt to FCF ratio (17.61) which is in line with its industry peers.
ARMK has a Debt/Equity ratio of 2.02. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 2.02, ARMK is in line with its industry, outperforming 54.14% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.02 | ||
| Debt/FCF | 17.61 | ||
| Altman-Z | 2.18 |
ROIC/WACC0.81
WACC7%
2.3 Liquidity
ARMK has a Current Ratio of 1.21. This is a normal value and indicates that ARMK is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Current ratio value of 1.21, ARMK is doing good in the industry, outperforming 62.41% of the companies in the same industry.
A Quick Ratio of 1.08 indicates that ARMK should not have too much problems paying its short term obligations.
ARMK has a Quick ratio of 1.08. This is comparable to the rest of the industry: ARMK outperforms 59.40% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.08 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.00% over the past year.
The Earnings Per Share has been decreasing by -7.10% on average over the past years.
The Revenue has been growing slightly by 0.35% in the past year.
The Revenue has been growing slightly by 1.41% on average over the past years.
EPS 1Y (TTM)0%
EPS 3YN/A
EPS 5Y-7.1%
EPS Q2Q%17.24%
Revenue 1Y (TTM)0.35%
Revenue growth 3Y12.89%
Revenue growth 5Y1.41%
Sales Q2Q%1.89%
3.2 Future
The Earnings Per Share is expected to grow by 15.18% on average over the next years. This is quite good.
ARMK is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.33% yearly.
EPS Next Y27.37%
EPS Next 2Y22.34%
EPS Next 3Y20.44%
EPS Next 5Y15.18%
Revenue Next Year6.78%
Revenue Next 2Y6.01%
Revenue Next 3Y5.89%
Revenue Next 5Y6.33%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 23.63, ARMK is valued on the expensive side.
63.91% of the companies in the same industry are more expensive than ARMK, based on the Price/Earnings ratio.
ARMK is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.55, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 17.31 indicates a rather expensive valuation of ARMK.
Based on the Price/Forward Earnings ratio, ARMK is valued a bit cheaper than the industry average as 64.66% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.40, ARMK is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.63 | ||
| Fwd PE | 17.31 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as ARMK.
Based on the Price/Free Cash Flow ratio, ARMK is valued a bit cheaper than the industry average as 63.91% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.37 | ||
| EV/EBITDA | 13.07 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as ARMK's earnings are expected to grow with 20.44% in the coming years.
PEG (NY)0.86
PEG (5Y)N/A
EPS Next 2Y22.34%
EPS Next 3Y20.44%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.06%, ARMK has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.82, ARMK pays a bit more dividend than its industry peers.
With a Dividend Yield of 1.06, ARMK pays less dividend than the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
5.2 History
The dividend of ARMK decreases each year by -2.79%.
ARMK has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-2.79%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
30.38% of the earnings are spent on dividend by ARMK. This is a low number and sustainable payout ratio.
DP30.38%
EPS Next 2Y22.34%
EPS Next 3Y20.44%
40.17
+0.6 (+1.52%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners106%
Inst Owner Change3.92%
Ins Owners0.52%
Ins Owner Change0.07%
Market Cap10.53B
Analysts83
Price Target45.42 (13.07%)
Short Float %4.25%
Short Ratio5.06
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
Yearly Dividend0.38
Dividend Growth(5Y)-2.79%
DP30.38%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.05%
Min EPS beat(2)1.94%
Max EPS beat(2)4.17%
EPS beat(4)3
Avg EPS beat(4)1.47%
Min EPS beat(4)-0.77%
Max EPS beat(4)4.17%
EPS beat(8)6
Avg EPS beat(8)3.04%
EPS beat(12)8
Avg EPS beat(12)2.15%
EPS beat(16)10
Avg EPS beat(16)8.41%
Revenue beat(2)0
Avg Revenue beat(2)-3.5%
Min Revenue beat(2)-3.64%
Max Revenue beat(2)-3.35%
Revenue beat(4)0
Avg Revenue beat(4)-2.62%
Min Revenue beat(4)-3.64%
Max Revenue beat(4)-0.5%
Revenue beat(8)3
Avg Revenue beat(8)-1.33%
Revenue beat(12)6
Avg Revenue beat(12)-1.04%
Revenue beat(16)9
Avg Revenue beat(16)-0.58%
PT rev (1m)1.55%
PT rev (3m)-0.08%
EPS NQ rev (1m)0.41%
EPS NQ rev (3m)2.06%
EPS NY rev (1m)1.21%
EPS NY rev (3m)1.1%
Revenue NQ rev (1m)-0.48%
Revenue NQ rev (3m)-0.44%
Revenue NY rev (1m)-0.11%
Revenue NY rev (3m)-0.14%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.63 | ||
| Fwd PE | 17.31 | ||
| P/S | 0.6 | ||
| P/FCF | 28.37 | ||
| P/OCF | 12.67 | ||
| P/B | 3.49 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.07 |
EPS(TTM)1.7
EY4.23%
EPS(NY)2.32
Fwd EY5.78%
FCF(TTM)1.42
FCFY3.52%
OCF(TTM)3.17
OCFY7.89%
SpS67.25
BVpS11.52
TBVpS-14.08
PEG (NY)0.86
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.58% | ||
| ROE | 11.52% | ||
| ROCE | 7.49% | ||
| ROIC | 5.66% | ||
| ROICexc | 6.21% | ||
| ROICexgc | 21.8% | ||
| OM | 4.38% | ||
| PM (TTM) | 1.97% | ||
| GM | 8.47% | ||
| FCFM | 2.11% |
ROA(3y)2.45%
ROA(5y)0.76%
ROE(3y)11.07%
ROE(5y)2.59%
ROIC(3y)4.93%
ROIC(5y)N/A
ROICexc(3y)5.48%
ROICexc(5y)N/A
ROICexgc(3y)26.7%
ROICexgc(5y)N/A
ROCE(3y)6.53%
ROCE(5y)N/A
ROICexcg growth 3Y122.06%
ROICexcg growth 5Y20.87%
ROICexc growth 3Y78.16%
ROICexc growth 5Y7.03%
OM growth 3Y40.47%
OM growth 5Y-1.21%
PM growth 3YN/A
PM growth 5Y-11.42%
GM growth 3Y5.79%
GM growth 5Y8.33%
F-Score5
Asset Turnover1.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.02 | ||
| Debt/FCF | 17.61 | ||
| Debt/EBITDA | 4.99 | ||
| Cap/Depr | 101.98% | ||
| Cap/Sales | 2.61% | ||
| Interest Coverage | -22.67 | ||
| Cash Conversion | 67.95% | ||
| Profit Quality | 106.62% | ||
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.08 | ||
| Altman-Z | 2.18 |
F-Score5
WACC7%
ROIC/WACC0.81
Cap/Depr(3y)88.23%
Cap/Depr(5y)81.81%
Cap/Sales(3y)2.41%
Cap/Sales(5y)2.77%
Profit Quality(3y)109.5%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)0%
EPS 3YN/A
EPS 5Y-7.1%
EPS Q2Q%17.24%
EPS Next Y27.37%
EPS Next 2Y22.34%
EPS Next 3Y20.44%
EPS Next 5Y15.18%
Revenue 1Y (TTM)0.35%
Revenue growth 3Y12.89%
Revenue growth 5Y1.41%
Sales Q2Q%1.89%
Revenue Next Year6.78%
Revenue Next 2Y6.01%
Revenue Next 3Y5.89%
Revenue Next 5Y6.33%
EBIT growth 1Y4.81%
EBIT growth 3Y58.57%
EBIT growth 5Y0.18%
EBIT Next Year60.84%
EBIT Next 3Y24.32%
EBIT Next 5Y16.87%
FCF growth 1Y157.47%
FCF growth 3Y6.26%
FCF growth 5Y-9.07%
OCF growth 1Y56.8%
OCF growth 3Y3.4%
OCF growth 5Y-5.89%