Aramark
Aramark Fundamental Analysis
Aramark (ARMK) shows weak financial fundamentals with a PE ratio of 33.74, profit margin of 1.69%, and ROE of 10.17%. The company generates $18.8B in annual revenue with moderate year-over-year growth of 6.35%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 25.6/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze ARMK's fundamental strength across five key dimensions:
Efficiency Score
WeakARMK struggles to generate sufficient returns from assets.
Valuation Score
ModerateARMK shows balanced valuation metrics.
Growth Score
ExcellentARMK delivers strong and consistent growth momentum.
Financial Health Score
ModerateARMK shows balanced financial health with some risks.
Profitability Score
WeakARMK struggles to sustain strong margins.
Key Financial Metrics
Is ARMK Expensive or Cheap?
P/E Ratio
ARMK trades at 33.74 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, ARMK's PEG of -13.83 indicates potential undervaluation.
Price to Book
The market values Aramark at 3.33 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 3.38 times EBITDA. This is generally considered low.
How Well Does ARMK Make Money?
Net Profit Margin
For every $100 in sales, Aramark keeps $1.69 as profit after all expenses.
Operating Margin
Core operations generate 4.22 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $10.17 in profit for every $100 of shareholder equity.
ROA
Aramark generates $2.34 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Aramark generates limited operating cash flow of $725.18M, signaling weaker underlying cash strength.
Free Cash Flow
Aramark generates weak or negative free cash flow of $256.83M, restricting financial flexibility.
FCF Per Share
Each share generates $0.98 in free cash annually.
FCF Yield
ARMK converts 2.41% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
33.74
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-13.83
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.33
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.57
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
2.13
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.27
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.10
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.07
vs 25 benchmark
How ARMK Stacks Against Its Sector Peers
| Metric | ARMK Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 33.74 | 26.49 | Worse (Expensive) |
| ROE | 10.17% | 1307.00% | Weak |
| Net Margin | 1.69% | -5131.00% (disorted) | Weak |
| Debt/Equity | 2.13 | 0.81 | Weak (High Leverage) |
| Current Ratio | 1.27 | 10.48 | Neutral |
| ROA | 2.34% | -1549793.00% (disorted) | Weak |
ARMK outperforms its industry in 0 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Aramark's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
37.67%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
167.51%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
397.52%
Industry Style: Cyclical, Value, Infrastructure
High Growth