Aramark ARMK
Aramark's stock has pulled back to $56.31 from post-earnings highs near $60, trading below its 50-day MA of $57.47 with RSI at 39, but the fundamental picture remains genuinely mixed. FY2025 revenue grew 6.35% to $18.5B with operating income up to $792M and FCF improving to $454M, while Q3 2026 organic growth hit 9% with approximately 98% client retention and new-business wins up 51% YTD to over $1.6B.
However, gross margin compressed sharply from 8.19% to 5.78% as gross profit fell from $1.43B to $1.07B despite higher revenue, and the 39.85x trailing PE trades at a 43% premium to the peer median of 27.89x. Improving smart money (score 0.0305 as of Q2 2026, up from near-zero) and net insider buying of +863K shares over 24 months are encouraging, but gross margin deterioration and the elevated multiple keep this a hold until margin trends stabilize.
What could go wrong
- Gross margin compression. Gross profit fell from $1.43B in FY2024 to $1.07B in FY2025 despite revenue rising 6.35%, compressing gross margin from 8.19% to 5.78% — operating margin expansion to 4.28% relied on cost cuts below the gross line that may not be repeatable.
- Elevated valuation. At 39.85x trailing earnings, ARMK trades at a 42.87% premium to the peer median PE of 27.89x, leaving little room for execution missteps.
- High leverage. Total debt of $5.72B against stockholders' equity of $3.15B as of FY2025 creates balance sheet sensitivity in a higher-rate environment.
- Technical weakness. Stock at $56.31 is below its 50-day MA of $57.47 with bearish MACD histogram of -0.44 and RSI at 39, suggesting near-term downside momentum.
What would change my mind
Where this comes from: FMP FY2025 annual + derived_metrics · FMP FY2024/FY2025 annual + derived_metrics · Defense World news article 2026-08-13 · peer_relative composite. Orin's read on ARMK; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All ARMK filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Massachusetts Financial Services /Ma/ | $903.1M | 0.3% of fund |
| Morgan Stanley | $677.1M | 0.0% of fund |
| Vanguard Capital Management | $674.8M | 0.0% of fund |
| Vanguard Portfolio Management | $636.1M | 0.0% of fund |
| State Street | $465.8M | 0.0% of fund |
| Aqr Capital Management | $457.4M | 0.2% of fund |
72 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 277 Form 4 filings, net $12.5M. Of the 50 on hand, 0 were open-market purchases and 2 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about ARMK
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Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 38.2× | — | 44.5× |
| EV/EBITDA | 15.0× | — | — |
| P/S | 0.74× | — | — |
| P/B | 4.3× | — | — |
14.2%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $0.5B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$69
$63 – $74 · +25% against today's price
- 21 buy or overweight
- 2 hold
- 1 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| ARMKAramark | $15B | 38.2× | 15.0× | 6.6% | 1.9% | 12% |
| AITApplied Industrial Technologies, Inc. | $12B | 30.1× | 23.0× | 30.3% | 8.3% | 22% |
| CNMCore & Main, Inc. | $8B | 17.5× | 10.9× | 27.0% | 6.0% | 23% |
| DCIDonaldson Company, Inc. | $10B | 22.1× | 17.9× | 34.6% | 11.7% | 28% |
| DRSLeonardo DRS, Inc. | $10B | 31.2× | 21.0× | 24.9% | 8.5% | 12% |
| FLSFlowserve Corporation | $10B | 26.8× | 15.7× | 35.1% | 8.0% | 17% |
| GNRCGenerac Holdings Inc. | $12B | 45.2× | 23.2× | 39.5% | 5.8% | 10% |
| POOLPool Corporation | $6B | 15.3× | 12.8× | 29.6% | 7.4% | 32% |
| SWKStanley Black & Decker, Inc. | $14B | 22.5× | 12.8× | 31.7% | 4.1% | 7% |
| UHALU-Haul Holding Company | $12B | 324.1× | 10.7× | 49.7% | 0.8% | 1% |
The median is of the 9 peers listed above and nothing else — check it against the column. This company trades 42.5% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.