What to expect from Aramark’s Q3 earnings

Food and facilities services provider Aramark (NYSE:ARMK) will be reporting results this Monday morning. Here’s what you need to know.

Aramark beat analysts’ revenue expectations last quarter, reporting revenues of $5.06 billion, up 9.3% year on year. It was a favorable quarter for the company, with a beat of analysts’ EPS estimates.

Is Aramark a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, the market is expecting Aramark’s revenue to grow 5.2% year on year, slowing from the 14.3% increase it recorded in the same quarter last year.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Aramark has missed Wall Street’s revenue estimates multiple times over the last two years.

Looking at Aramark’s peers in the business process outsourcing & consulting segment, some have already reported their Q3 results, giving us a hint as to what we can expect. CRA delivered year-on-year revenue growth of 15.6%, beating analysts’ expectations by 8%, and FTI Consulting reported revenues up 5.9%, in line with consensus estimates. CRA traded up 1.5% following the results while FTI Consulting was also up 15.3%.

Read our full analysis of CRA’s results here and FTI Consulting’s results here.

Investors in the business process outsourcing & consulting segment have had steady hands going into earnings, with share prices up 1% on average over the last month. Aramark is down 2.3% during the same time and is heading into earnings with an average analyst price target of $68.16 (compared to the current share price of $52.91).

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