Wells Fargo Starts ARAMARK Holdings (ARMK) at Outperform

January 21, 2014 8:03 AM EST
Get Alerts ARMK Hot Sheet
Price: $33.26 +0.54%

Rating Summary:
    11 Buy, 2 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 18 | Down: 19 | New: 11
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Wells Fargo initiated coverage on ARAMARK Holdings (NYSE: ARMK) with an Outperform rating and a price target of $28-$29.

"We expect to see valuation multiple expansion in 2014 and beyond as ARAMARK demonstrates an ability to deliver stable, high-visibility, low-double-digit EPS growth. Our FY2014 and FY2015 EPS estimates are $1.29 and $1.46," said analyst Jeff Farmer.

"We expect ARAMARK's revenue growth to benefit from the combination of (1) a sizeable structural tailwind, driven by outsourcing trends and (2) company-specific opportunities, including improved client retention rates and growing revenue from existing client relationships (cross-selling and capturing low-hanging adjacencies). ARAMARK is targeting a 3-5% long-term revenue growth rate, which we view as achievable given the combination of structural outsourcing tailwinds and ARAMARK's company-specific opportunities," he added.

For an analyst ratings summary and ratings history on ARAMARK Holdings click here. For more ratings news on ARAMARK Holdings click here.

Shares of ARAMARK Holdings closed at $24.51 yesterday.

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