Aramark upgraded to Buy from Hold at Jefferies

Jefferies upgraded Aramark to Buy from Hold with a price target of $29, down from $44. The analyst expects organic growth of 6% in fiscal 2024 and 2025, or two-times the company’s pre-Covid trend rate, driven by a successful multi-year turnaround effort and a “step change” in the industry’s outsourcing penetration rate post-Covid driving new business wins. The firm says Aramark’s margin expectations have been reset and lagging price dynamics in fiscal 2024 should provide a “nice lift.” It believes it is time to give Aramark credit for its multi-year turnaround strategy.