How Does Aramark Compare with Its Peers?
Aramark’s peers are ahead of the company based on price-to-sales ratios. However, Aramark has outperformed its peers based on other measures.
Aramark (ARMK) is in the service business, offering food, facilities, and uniforms. It has a market cap of $7.8 billion.
Wipro’s 14-day RSI is 38, which suggests that the stock is slightly oversold. It is trading at a premium of 7% to the median analyst price target.
Accenture’s 14-day RSI is 31, which shows that the stock is slightly oversold. It’s trading at a 13% discount from the median analyst price target.
The analyst stock price target for Cognizant is $75.12, with a median target estimate of $75, which means Cognizant is trading at a discount of 17%.
Accenture’s interest coverage ratio looks comfortable, due to low debt levels and to the fact that its operating margin has been expanding steadily.
In the past 12 months, Accenture’s revenue growth per share has increased by 7.8%, while Cognizant’s has increased by 17.6%.
Accenture reported 3Q15 revenues of ~$8.28 billion, compared to $8.24 billion in 3Q14. Its gross profits for 3Q15 were $2.52 billion, a 0.43% YoY decline.
Accenture is one of the world’s largest multinational technology services, management consulting, and outsourcing companies and is headquartered in Dublin.
Best Buy’s same-store sales grew in fiscal 2015 after declining continuously since fiscal 2011. Its same-store sales grew by 0.5% in fiscal 2015.
Best Buy’s (BBY) productivity measures in fiscal 2015 helped improve its margins. Its operating margin in fiscal 2015 improved to 3.6%.
In fiscal 2015—ending January 31, 2015—Best Buy (BBY) derived ~47% of its US revenue from computing devices and mobile phones.
In 4Q15, Best Buy’s EPS was $1.48—ahead of analysts’ estimate of $1.35. Its earnings beat analysts’ estimate in each of the four quarters in fiscal 2015.
With its restructuring, Best Buy will have a total of 192 locations across Canada—including 136 large-format stores and 56 Best Buy Mobile stores.
Pricing pressures come from rival superstores as well as a variety of discount stores and online retailers. Therefore, a merger likely won’t result in higher prices for consumers.
Last week, SPLS reported a data breach. Credit card information was stolen for ~1.16 million customers. This will likely impact retail (XRT) (XLY) and e-commerce sales.
Therefore, a possible acquisition by SPLS will likely be an all-stock deal. This was the case in the ODP-OfficeMax (OMX) merger of equals.
The estimated cost synergies from a merger between SLPS and ODP would likely be $1.2–$1.5 billion after the companies’ integration is complete.
PetSmart (PETM) is a specialty pet goods retailer. On December 14, PETM announced its leveraged buyout, or LBO, by an investor group. The investor group is led by BC Partners.
When Starboard Value’s positions in Staples (SPLS) and Office Depot (ODP) were known, markets speculated about a possible merger opportunity.