$Aramark(ARMK-W)$ (ARMK) is poised to deliver strong fiscal Q3 results, supported by solid core performance and continued momentum across key business lines, Oppenheimer said Monday in a report.
The company is a global provider of food and facilities services across education, healthcare, business and industry, and sports, leisure and corrections clients. Organic core revenue is approaching the high end of the 7% to 9% range, helped by record retention above 98% and about $1 billion in net-new business year to date, the report said.
Data-center contracts remain incremental to growth and may add $3 billion to $4 billion in revenue by 2028 on a run-rate basis, Oppenheimer said. Aramark is in discussions with several hyperscalers and aims to secure 10 to 12 deals by 2027 and 30 to 40 by 2028, the report said.
The company also continues to manage cost and inflation effectively, positioning it to expand margins by 30 to 40 basis points annually over the next several years, the report said.
Oppenheimer raised its price target on Aramark stock to $65 from $60 and maintained its outperform rating.
Q3 results are expected Aug. 11.
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