Is Aramark (NYSE:ARMK) outlook optimistic based on the recent analyst consensus?

ARMK Stock

USD 43.96 0.19 0.43%

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Aramark Holdings Corp is scheduled to announce its earnings today. While some baby boomers are getting worried about their positions in industrials space, it is entirely reasonable to examine Aramark Holdings as a possible position for your existing portfolio. We will concentrate on the reasons why it is still possible for the company to generate above-average margins given the recent economic outlook.

Published over two months ago

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Aramark Holdings has a performance score of 2 on a scale of 0 to 100. The firm shows a Beta (market volatility) of 1.2401, which signifies a somewhat significant risk relative to the market. Let's try to break down what Aramark's beta means in this case. As the market goes up, the company is expected to outperform it. However, if the market returns are negative, Aramark Holdings will likely underperform. Although it is important to respect Aramark Holdings Corp historical returns, it is better to be realistic regarding the information on the equity's current trending patterns. The philosophy in foreseeing future performance of any stock is to evaluate the business as a whole together with its past performance, including all available fundamental and technical indicators. By analyzing Aramark Holdings Corp technical indicators, you can presently evaluate if the expected return of 0.07% will be sustainable into the future. Aramark Holdings Corp right now shows a risk of 2.21%. Please confirm Aramark Holdings Corp coefficient of variation, semi variance, price action indicator, as well as the relationship between the treynor ratio and daily balance of power to decide if Aramark Holdings Corp will be following its price patterns.

Is Aramark (NYSE:ARMK) outlook optimistic based on the recent analyst consensus?

What is the right price you would pay to acquire a share of Aramark Holdings? For most investors, it would be the price that gives them a wide margin of safety to have minimal downside risk. In other words, most investors are always looking for undervalued stocks. Even if the future performance is not entirely as expected, the loss of holding it is minimized, and the downside risk is negated.

Please read more on our stock advisor page.

What is happening with Aramark Holdings this year

Annual and quarterly reports issued by Aramark Holdings are formal financial statements that are published yearly and quarterly and sent to Aramark stockholders. The reports show and break down the current year's ongoing operations and discuss plans for the upcoming year. Annual reports have been a requirement from the Securities and Exchange Commission (SEC) for businesses owned by the public since 1934.

Companies such as Aramark Holdings often view their annual report as an effective marketing tool to disseminate their perspective on company future earnings or innovations. With this in mind, many companies devote large sums of money to making their reports attractive and informative. In such instances, the annual report becomes a forum through which a company can communicate to the general public any number of topics that may or may not be directly related to the actual data published in the reports.

How does Aramark utilize its cash?

To perform a cash flow analysis of Aramark Holdings, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Aramark Holdings is receiving and how much cash it distributes out in a given period. The Aramark Holdings cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.

Aramark Holdings Net Cash Flow from Operations is increasing as compared to previous years. The last year's value of Net Cash Flow from Operations was reported at 725.98 Million

Breaking it down

Earning per share calculations of the firm is based on official Zacks consensus of 5 analysts regarding Aramark Holdings' future annual earnings. Given the historical accuracy of 91.06%, the future earnings per share of the company is estimated to be 1.36 with the lowest and highest values of 1.27 and 1.44, respectively. Please note that this consensus of annual earnings estimates for Aramark Holdings Corp is an estimate of EPS before non-recurring items and including employee stock options expenses.

Is Aramark a risky opportunity?

Let's check the volatility. Aramark is looking slightly risky at this time. Whether you invest your money or manage your clients' funds, remember that it is easy to forget that behind Aramark (NYSE:ARMK) stock is an actual business venture. So, do not let stock picking become an abstract concept by ignoring the elementary risk calculations. purchasing a share of an Aramark Holdings stock makes you a part-owner of that company.

Aramark Holdings Corp Current Consensus

Here is the recent trade recommendation based on an ongoing consensus estimate among financial analysis covering Aramark Holdings Corp. The Aramark consensus assessment is calculated by taking the average estimates from all of the analysts covering Aramark Holdings

Strong Buy

Hold

Strong Sell

Strong Buy	4	44.44
Buy	0	0.0
Hold	4	44.44
Sell	0	0.0
Strong Sell	1	11.11

Aramark Holdings implied volatility may change after the surge

Downside deviation is down to 2.02. It may signify a possible volatility plunge. Aramark Holdings Corp currently demonstrates below-average downside deviation. It has Information Ratio of 0.04 and Jensen Alpha of 0.09. However, we advise investors to further question Aramark Holdings Corp expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Aramark Holdings' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Aramark Holdings' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Although some other firms under the specialty business services industry are still a bit expensive, Aramark Holdings may offer a potential longer-term growth to traders. With a less-than optimistic outlook for your 90 days horizon, it may be a good time to exit some or all of your Aramark Holdings holdings as it seems the potential growth was already fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Aramark Holdings.

Editorial Staff

Rifka Kats is a Member of Macroaxis Editorial Board. Rifka writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce. View Profile

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Rifka Kats do not own shares of Aramark Holdings. Please refer to our Terms of Use for any information regarding our disclosure principles.

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