Why Food Company Aramark Shares Are Sliding Today
Portfolio Pulse from Nabaparna Bhattacharya
Aramark (NYSE:ARMK) reported Q4 revenue of $4.902 billion, surpassing analyst expectations of $4.79 billion, with a 12% Y/Y increase. Adjusted EPS of $0.64 met estimates. Growth was driven by new business, pricing actions, and base business growth, with a slight boost from currency translation. Operating income rose 40% Y/Y to $278 million, and adjusted operating income increased 28% to $339 million. Aramark completed the spin-off of its Uniform Services business, now Vestis, and declared a dividend of 9.5 cents per share. The company ended the quarter with $1.963 billion in cash and equivalents. For FY24, Aramark forecasts 7%-9% organic revenue growth and 15%-20% adjusted operating income growth, with adjusted EPS expected to grow by 25%-35%. Shares fell by 7.22% to $26.46.

November 14, 2023 | 6:17 pm
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Aramark reported strong Q4 earnings with revenue and adjusted EPS meeting or exceeding expectations, completed a spin-off, and declared a dividend. Despite positive FY24 outlook, shares dropped significantly.
Despite Aramark's positive earnings report and future outlook, the stock price has decreased significantly, which could be due to market expectations of even better performance or other external factors not mentioned in the article. The dividend declaration and spin-off completion are positive, but the immediate market reaction has been negative, suggesting a short-term bearish sentiment.
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