Aramark "FQ3 Preview: Growth Upside Likely for Quarter, F2027" (Buy) Chan

Research evidence excerpt

Aramark "FQ3 Preview: Growth Upside Likely for Quarter, F2027" (Buy) Chan

hink FX tailwinds could be

Q2 0.49 0.49 0 0.48

~90bps in FQ3, above the Street's ~40bps estimate.

Q3E 0.47 0.48 2 0.48

We model slightly lower margins. We model 5.0% AOI margin in FQ3, slightly Q4E 0.72 0.71 -1 0.76

below Street of 5.2% and flat yoy. We're choosing to be more cautious on margins 09/26E 2.18 2.19 0 2.25

because ARMK's model contemplates +30-40bps of normalized margin 09/27E 2.56 2.59 1 2.69

09/28E 2.88 2.94 2 3.15

expansion, but FQ3 should see some headwind relative to the calendar shift. We

also think there could be some new business startup costs and/or incentive comp Joshua Chan, CFA

impact in the quarter. Overall, our above-consensus revenue and below-consensus Analyst

margin assumptions net to an in-line EPS estimate of $0.48 for the quarter. joshua.chan@ubs.com

+1-212-713 9957

F2026 guide likely reiterated. We suspect ARMK likely reiterates full-year F2026

Karandeep Singhania

organic growth guidance at the "high-end" of +7-9% (excluding weeks) and

Associate Analyst

AOI guidance of $1.10-1.15B. karandeep.singhania@ubs.com

Recent net new momentum seems strong. In addition to the well-publicized +1-212-713 4211

datacenter contract win, we also note that core wins have been strong. During the Brianna Kamdoum

quarter, we note that ARMK won business at Florida State University, Texas State Associate Analyst

University, Grand Canyon University, T-Mobile Arena in the Czech Republic, brianna.kamdoum@ubs.com

+1-212-882 5027 University of Wisconsin Oshkosh, among others. These are offset by a loss at Tulsa

Public Schools. We believe the company is well on track to achieving its +4-5% net

new target for F2026.

Highlights (US$m) 09/23 09/24 09/25 09/26E 09/27E 09/28E 09/29E 09/30E