Aramark (NYSE:ARMK) Announces Quarterly Earnings Results, Beats Expectations By $0.04 EPS

Key Points

• Aramark beat quarterly earnings expectations, reporting EPS of $0.52 versus the $0.48 consensus, while revenue increased 9.3% year over year. The company raised fiscal 2026 organic revenue growth guidance to 9%–10% and maintained adjusted EPS growth guidance of 20%–25%.
• Aramark Nexus is emerging as a significant growth driver, with three advanced hyperscaler and AI data-center sites expected to generate approximately $400 million–$500 million in annual revenue as they ramp through fiscal 2027–2028, at above-average margins.
• Strong operating performance included 98% client retention, $1.6 billion in year-to-date new client wins, and robust cash generation that supported a $100 million term-loan repayment. Shares rose to about $60.33, near their 12-month high.

Aramark (NYSE:ARMK - Get Free Report) issued its quarterly earnings results on Tuesday. The company reported $0.52 earnings per share for the quarter, topping analysts' consensus estimates of $0.48 by $0.04, Briefing.com reports. Aramark had a net margin of 1.84% and a return on equity of 17.05%. During the same quarter in the previous year, the company posted $0.40 earnings per share. The business's revenue for the quarter was up 9.3% compared to the same quarter last year. Aramark updated its FY 2026 guidance to 2.180-2.280 EPS.

Here are the key takeaways from Aramark's conference call:

• Fiscal 2026 organic revenue growth guidance was raised to 9%–10%, reflecting broad-based momentum across U.S. and international operations and an early contribution from Aramark Nexus. Adjusted operating income growth remains guided at 12%–17%, with adjusted EPS growth of 20%–25%.
• Third-quarter organic revenue increased 9% to $5 billion, while adjusted operating income rose 13% to $261 million and adjusted EPS grew nearly 30% to $0.52; results would have been stronger absent an estimated $20 million calendar-shift impact.
• Aramark Nexus is scaling rapidly, with the initial hyperscaler engagement expanding roughly 40% to about $140 million annually, a second site estimated at approximately $160 million annually, and a separate AI data-center colocation agreement. The three most advanced sites are expected to generate roughly $400 million–$500 million of annual revenue as they ramp through fiscal 2027–2028, at margins above the company average.
• Business fundamentals remain strong, including approximately 98% client retention, $1.6 billion of fiscal-year-to-date new client wins—up 51% year over year—and double-digit growth in Workplace Experience and Refreshments for the 19th consecutive quarter.
• Strong cash generation enabled Aramark to repay $100 million of term loans after quarter-end, and management remains committed to reducing leverage below three times by fiscal year-end. Future capital allocation could include continued growth investment, targeted M&A, and potentially increased share repurchases.

Aramark Price Performance

Shares of NYSE:ARMK traded up $4.62 during trading on Tuesday, hitting $60.33. 440,166 shares of the stock were exchanged, compared to its average volume of 2,850,410. The company has a market cap of $15.86 billion, a PE ratio of 45.20, a P/E/G ratio of 1.06 and a beta of 1.12. The company has a current ratio of 1.21, a quick ratio of 1.07 and a debt-to-equity ratio of 1.85. The company has a fifty day moving average price of $55.70 and a two-hundred day moving average price of $47.62. Aramark has a 12-month low of $35.07 and a 12-month high of $60.58.

Aramark Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Wednesday, September 9th. Stockholders of record on Wednesday, August 19th will be paid a dividend of $0.12 per share. The ex-dividend date of this dividend is Wednesday, August 19th. This represents a $0.48 annualized dividend and a dividend yield of 0.8%. Aramark's payout ratio is 35.82%.

Institutional Inflows and Outflows

Hedge funds have recently made changes to their positions in the company. Caitong International Asset Management Co. Ltd boosted its position in shares of Aramark by 55.3% in the 4th quarter. Caitong International Asset Management Co. Ltd now owns 1,152 shares of the company's stock worth $42,000 after buying an additional 410 shares in the last quarter. Cetera Investment Advisers increased its holdings in Aramark by 7.4% during the 2nd quarter. Cetera Investment Advisers now owns 8,294 shares of the company's stock valued at $347,000 after acquiring an additional 573 shares in the last quarter. Vanguard Personalized Indexing Management LLC raised its position in Aramark by 4.0% during the fourth quarter. Vanguard Personalized Indexing Management LLC now owns 18,711 shares of the company's stock worth $690,000 after acquiring an additional 721 shares during the last quarter. Kestra Advisory Services LLC acquired a new position in shares of Aramark during the 4th quarter worth approximately $32,000. Finally, Quarry LP acquired a new position in shares of Aramark during the 3rd quarter worth approximately $35,000.

Analyst Upgrades and Downgrades

ARMK has been the topic of a number of research reports. The Goldman Sachs Group reissued a "buy" rating and set a $51.00 price target on shares of Aramark in a report on Wednesday, May 13th. Bank of America upped their price objective on Aramark from $59.00 to $62.00 and gave the company a "buy" rating in a research note on Tuesday, June 2nd. Stifel Nicolaus increased their price objective on Aramark from $47.00 to $54.00 and gave the stock a "buy" rating in a research report on Wednesday, May 13th. Robert W. Baird set a $63.00 price target on Aramark in a research note on Friday, July 24th. Finally, Morgan Stanley increased their price target on Aramark from $45.00 to $50.00 and gave the stock an "equal weight" rating in a report on Wednesday, May 13th. Eleven equities research analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the stock. According to MarketBeat, the company currently has an average rating of "Moderate Buy" and a consensus target price of $60.62.

About Aramark

Aramark NYSE: ARMK is a global provider of food services, facilities management and uniform solutions, serving clients across a wide array of industries including education, healthcare, business and government. The company operates through three primary segments: Food and Support Services, Uniform and Career Apparel, and Facility Services, delivering integrated solutions designed to enhance guest experiences, improve operational efficiencies and maintain safe, clean environments. Aramark's offerings include corporate dining, patient and senior nutrition, campus dining, sports and entertainment concessions, custodial services, technical maintenance and industrial laundry.

Founded in 1959 and headquartered in Philadelphia, Pennsylvania, Aramark has expanded its footprint to more than 20 countries, with a strong presence in North America, Latin America, Europe and Asia.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

Continue following MarketBeat

Add MarketBeat as your preferred source on Google to see our latest stories in your feed.

Add As Preferred Source