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Aramark Seen Benefiting From Data Centers, Core Momentum, Truist Says

Aramark (ARMK) is likely to benefit from faster data center growth, strong new-business wins, high customer retention and steady demand across its core food and support service operations, Truist Securities said Monday in a report.Truist expects Aramark to report slightly better-than-expected fiscal Q3 revenue and adjusted operating income, though major contributions from its Nexus data center business may take another two to three quarters to show in results.Aramark may finish fiscal 2026 near the top of its 7% to 9% organic growth target as new contracts, strong retention and early Nexus business add to growth, the report said.Truist estimates a $39 billion US market for Nexus and said Aramark's second AI data center customer may eventually generate hundreds of millions of dollars in annual revenue if multiple sites and services are added.Truist raised its price target on Aramark stock to $70 from $58 and maintained its buy rating. Fiscal Q3 results are expected Aug. 11.Price: $57.78, Change: $+0.60, Percent Change: +1.05%

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Wire

Aramark's Intra-Quarter Contract Wins Could Strengthen Fiscal 2027 Growth Outlook, UBS Says

Aramark (ARMK) shares have performed well, and upside revisions to growth estimates are likely warranted, as recent intra-quarter wins suggest net new momentum remains strong and could strengthen the fiscal 2027 growth outlook, UBS Securities said in a note emailed Monday.The brokerage expects Aramark to potentially reiterate its full-year fiscal 2026 organic growth guidance at the "high-end" of its 7% to 9% range and adjusted operating income guidance of $1.10 billion to $1.15 billion, the note added.In addition to the datacenter contract win, the company had multiple core wins, partially offset by the loss of the Tulsa Public Schools contract. UBS thinks Aramark is on track to achieve its 4% to 5% net new target for fiscal 2026.The brokerage raised its fiscal Q3 organic growth estimate to 6.6% from 5.7% and its EPS estimate to $0.48 from $0.47. For fiscal 2026, it now expects organic growth of 6.8% versus 6.7% previously, while raising its EPS estimate to $2.19 from $2.18. The brokerage also lifted its fiscal 2027 organic growth estimate to 7.9% from 6.9% and its EPS estimate to $2.59 from $2.56.UBS kept a buy rating on Aramark and raised its price target to $67 from $56.Price: $58.28, Change: $+0.40, Percent Change: +0.69%

$ARMK
Wire

UBS Adjusts Price Target on Aramark to $67 From $56, Maintains Buy Rating

Aramark (ARMK) has an average rating of overweight and mean price target of $60.20, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)Price: $58.31, Change: $+0.42, Percent Change: +0.73%

$ARMK
Wire

Aramark Seen Delivering Strong Fiscal Q3 Results, Oppenheimer Says

Aramark (ARMK) is poised to deliver strong fiscal Q3 results, supported by solid core performance and continued momentum across key business lines, Oppenheimer said Monday in a report.The company is a global provider of food and facilities services across education, healthcare, business and industry, and sports, leisure and corrections clients. Organic core revenue is approaching the high end of the 7% to 9% range, helped by record retention above 98% and about $1 billion in net-new business year to date, the report said.Data-center contracts remain incremental to growth and may add $3 billion to $4 billion in revenue by 2028 on a run-rate basis, Oppenheimer said. Aramark is in discussions with several hyperscalers and aims to secure 10 to 12 deals by 2027 and 30 to 40 by 2028, the report said.The company also continues to manage cost and inflation effectively, positioning it to expand margins by 30 to 40 basis points annually over the next several years, the report said.Oppenheimer raised its price target on Aramark stock to $65 from $60 and maintained its outperform rating.Q3 results are expected Aug. 11.Price: $55.33, Change: $-0.73, Percent Change: -1.30%

$ARMK
Aramark Poised for Solid Third Quarter Amid Revenue Outperformance, Oppenheimer Says
US Markets

Aramark Poised for Solid Third Quarter Amid Revenue Outperformance, Oppenheimer Says

Aramark (ARMK) is expected to report strong fiscal third-quarter results as the company should continue exceeding top-line expectations while keeping costs under control, Oppenheimer said in a Monday note.The food, facilities and uniform services provider's core revenue growth looks on track to hit the top end of the 7% to 9% organic range amid record net new deals worth about $1 billion so far this year and a retention level at above 98%, according to the brokerage.Oppenheimer is projecting that third-quarter sales will grow 6.2% year over year to $4.91 billion and adjusted per-share earnings will increase to $0.47 from $0.40 a year earlier. Analysts in a FactSet poll are currently looking for revenue of $4.92 billion and non-GAAP EPS of $0.48. The company is expected to release fiscal third-quarter results in early August."Overall, we anticipate a solid quarter driven by top-line outperformance and strong middle-of-the-P&L discipline," Oppenheimer analysts Ian Zaffino and Isaac Sellhausen said, adding that the core business could get a boost from the World Cup.Aramark Nexus, the company's business platform focused on providing services to data centers, is also helping boost revenue, the analysts said.The Nexus business could bring in $3 billion to $4 billion in revenue with margins above the company average amid potential new deals with hyperscalers, they said."The (data center ) opportunity remains incremental to Aramark's growth algorithm of (5% to 8% organic top line), and we could see a total of 30 (to) 40 DC deals by the end of 2028," the analysts said.Aramark has also been able to control costs and manage inflation given updated contract terms that allow for the quicker pass-through, Oppenheimer said."While inflation remains elevated, (Aramark) should continue to be able to expand margins by (30 to 40 basis points) annually for the next several years, before reaching a longer-term target of (20 to 30 basis points)," the analysts said.Oppenheimer raised its price target for Aramark shares to $65 from $60, with outperform rating.Price: $55.91, Change: $-0.15, Percent Change: -0.27%

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Wire

Aramark's Data Center Opportunity Could be Larger than Expected, Oppenheimer Says

Aramark's (ARMK) data center opportunity could be larger than expected while its core business appears to be hitting its stride, Oppenheimer said in a Thursday note.The report said the company is ramping up its first data center win and should operate about 12 locations by the end of next year and 30 to 40 by the end of the following year.The note said its base business appears to be gaining share, and food and labor inflation should not pose a problem to margins. It also said the firm could initiate an accelerated share buyback on an expected decline in its net leverage."Overall, the core business is performing well and the DC opportunity could be larger than expected," the report said.Oppenheimer retained its outperform rating and increased its price target to $60 from $50.Price: $54.02, Change: $+0.72, Percent Change: +1.34%

$ARMK
Wire

Aramark Q2 Organic Revenue Beat Drives Higher Growth Outlook, Morgan Stanley Says

Aramark's (ARMK) fiscal Q2 organic revenue exceeded estimates, helping drive management to target the upper end of its annual organic revenue growth guidance range, while year-to-date new business wins totaled $1 billion as forward key performance indicators remain strong, Morgan Stanley said Wednesday.Positive key metrics like a 98% retention rate and accelerating new wins support ongoing strong performance. Aramark's year-to-date gross new wins compare with $1.6 billion for all of fiscal 2025, putting the company on track for another record year of wins.Aramark's recent hyperscaler win is now the largest contract in its portfolio, at "well over" $100 million normalized annual run rate per location under contract, and should ultimately generate several hundred million dollars over the contract duration, the brokerage added.The firm sees potential upside from the World Cup per-cap spend and views the months into September as key for new education sector wins, backing management's belief of 2026 being a very strong year for new business, according to the note.Morgan Stanley reiterated its equal weight rating on Aramark and raised the price target to $50 from $45.Price: $49.37, Change: $+0.96, Percent Change: +1.98%

$ARMK
Wire

UBS Adjusts Aramark Price Target to $56 From $48, Maintains Buy Rating

Aramark (ARMK) has an average rating of overweight and mean price target of $52.50, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://finwires.com/en/contact)Price: $49.10, Change: $+0.70, Percent Change: +1.45%

$ARMK
Stocks Down Pre-Bell as Trump Warns US-Iran Ceasefire Fragile; Inflation Data on Deck
US Markets

Stocks Down Pre-Bell as Trump Warns US-Iran Ceasefire Fragile; Inflation Data on Deck

US equity futures were pointing lower on Tuesday as investors assess President Donald Trump's latest comments on the US-Iran ceasefire and await a key inflation report.The S&P 500 declined 0.3%, the Dow Jones Industrial Average edged down 0.1% and the Nasdaq was off 0.7% in premarket activity. The indexes finished the previous trading session up, with the S&P 500 and the Nasdaq logging new closing highs.The ceasefire agreement between the US and Iran is on "massive life support," Trump told reporters on Monday, according to several media outlets. "I would call it the weakest, right now, after reading that piece of garbage they sent us - I didn't even finish reading it," Trump reportedly said.Trump on Sunday rejected Iran's counteroffer to end the war, extending uncertainty around oil flows through the Strait of Hormuz. Tehran's proposal, delivered via mediator Pakistan, reportedly sought an immediate end to hostilities, the lifting of the US naval blockade of its ports and assurances against further aggression.West Texas Intermediate crude oil increased 3.2% to $101.16 a barrel before the opening bell, while Brent advanced 2.9% to $107.27.Trump is scheduled to arrive in China Wednesday for a high-stakes state visit, with talks set to take place Thursday and Friday."The US will want China to use its influence with Tehran, especially because China is a major buyer of Iranian oil," Saxo Bank Chief Investment Strategist Charu Chanana said in a report Monday. "China, meanwhile, wants energy security and stable shipping lanes, but it is unlikely to appear as if it is acting under US instruction."The consumer price index report for April is scheduled for an 8:30 am ET release. Official data are expected to show that consumer inflation rose 0.6% and 3.7% on sequential and annual bases last month, according to a Bloomberg-compiled consensus.Treasury yields were trending higher in premarket action, with the two-year rate rising 2.4 basis points to 3.97% and the 10-year rate adding 1.9 basis points to 4.43%.The National Federation of Independent Business small business optimism index posted a 0.1-point increase for April to 95.9.Sea (SE), JD.com (JD), On Holding (ONON), Tencent Music Entertainment (TME), Aramark (ARMK) and Under Armour (UA, UAA) are scheduled to report their latest financial results before the bell, among others.Gold declined 0.6% to $4,701 per troy ounce, while bitcoin fell 1.5% to $80,679.

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