AlphaValue/Baader Europe Revises Sodexo Rating, Forecasts Amid 'Significant Underperformance'

10:28 AM EST, 12/09/2025 (MT Newswires) -- AlphaValue/Baader Europe cut Sodexo's (SW.PA) rating and earnings forecasts as it awaits a "clear and concrete" turnaround plan from the French food services and facilities management group amid a faltering performance in North America. The research firm changed its recommendation on the stock to add from buy on Monday, with a price target of 56.3 euros. "Sodexo has experienced significant underperformance since this spring, and the relevant operational difficulties appear structural, requiring meaningful investments to restore longer-term efficiency, particularly in North America," analysts wrote. "The FY26 guidance to August, for underlying operating profit fell short of expectations, coupled with yoy heightened restructuring and financial expenses, in addition to a higher tax rate." As such, EPS estimates for fiscal years 2026 and 2027 were respectively slashed by 18.2% and 20.7% to 4.14 euros and 4.68 euros. The underlying operating profit and pre-exceptional after-tax profit projections for fiscal 2026 were also reduced. Analysts, however, noted that they continue to see the group in a positive light over the longer term on hopes that a management team overhaul will soon take place after the recent arrival of a new chief executive officer.