Aramark, known for its uniforms rental business, reported double-digit profit gains last year ranging from 33% to 44%. Then, in the fourth quarter, it really took off, posting a 173% leap in EPS. Meanwhile, revenue grew at a steady double-digit pace. On Wednesday the Relative Strength Rating for Aramark stock rose into a higher percentile, climbing from 69 to 72.
Aramark is within a buy zone after climbing above a 29.38 entry in a cup-with-handle base. On Wednesday Aramark stock closed at 30.47, down 1.3% for the day and up about 27% from the bottom of the cup pattern on Oct. 3.
Aramark Stock Has Sibling, Vestis
Philadelphia-based Aramark provides uniform services through its new Vestis unit, formerly Aramark Uniform Services. Vestis went public under the ticker VSTS at the end of September. Aramark also provides food services and facilities management, and specialized supply chain management.
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Among its other ratings Aramark stock has a 79 rating for both its Composite Rating and Earnings Per Share Rating. It also has a strong B SMR Rating (sales + profit margins + return on equity) and a B Accumulation/Distribution Rating, showing fairly heavy buying by Insurance funds, ETFs and the like.
Top and bottom line growth moved higher in the company's most recent quarter. Earnings were up 173% to 41 cents per share, compared to a 36% rise in the prior report. Revenue grew 13% to $4.41 billion. The prior three quarters its sales rose 19%, 15% and 12%.
No. 7 Ranked In Commercial Services Group
Aramark stock holds the No. 7 rank among its peers in the 24-stock Commercial Services-Outsourcing industry group. Claims management company Crawford and health care savings platform provider HealthEquity are also among the group's highest-rated stocks.
When looking for the best stocks to buy and watch, keep a close on eye on relative price strength.
IBD's proprietary RS Rating identifies technical performance by using a 1 (worst) to 99 (best) score that shows how a stock's price performance over the trailing 52 weeks compares to other publicly traded companies.
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