$Aramark(ARMK-W)$ (ARMK) faces a challenging setup ahead of fiscal 2027 guidance, with investor expectations potentially exceeding management's outlook, UBS said in a note on Wednesday.
The analysts estimate the company will generate $427 million in Nexus revenue in fiscal 2027, based on four of its nine announced site wins with confirmed progress. This would contribute 1.9 percentage points to total organic revenue growth of 9.9%, they added.
While investors expect organic growth of 10% to 12%, the analysts believe management may take a more cautious approach and guide to around 10% or higher, given uncertainty around data center projects.
"Given buyside bar, we think it could be difficult for fiscal 2027 guidance to both hit the buyside bar and appear prudent, resulting in a trickier setup into the print," the analysts added.
UBS lowered its price target on Aramark to $65 from $71 and kept its buy rating.
Price: 54.13, Change: -0.09, Percent Change: -0.17
