Compass vs Aramark Which Is Superior?

Compass Group and Aramark Corporation are two well-known companies in the food and facilities management industry. Both companies operate globally and provide a range of services to clients in various sectors. However, their stocks have performed differently in recent years. While Compass Group has seen steady growth and remains a popular choice for investors, Aramark has faced some challenges that have impacted its stock performance. In this comparison, we will analyze the strengths and weaknesses of both companies to determine which might be the better investment option.

Compass or Aramark?

When comparing Compass and Aramark, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Compass and Aramark.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Compass has a dividend yield of -%, while Aramark has a dividend yield of 0.97%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Compass reports a 5-year dividend growth of 0.00% year and a payout ratio of -14.93%. On the other hand, Aramark reports a 5-year dividend growth of 0.00% year and a payout ratio of 38.05%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Compass P/E ratio at -17.34 and Aramark's P/E ratio at 40.38. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Compass P/B ratio is 8.00 while Aramark's P/B ratio is 3.49.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Compass has seen a 5-year revenue growth of 3.20%, while Aramark's is 0.13%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Compass's ROE at -49.85% and Aramark's ROE at 8.96%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $6.72 for Compass and $39.81 for Aramark. Over the past year, Compass's prices ranged from $2.78 to $7.69, with a yearly change of 176.62%. Aramark's prices fluctuated between $27.05 and $42.49, with a yearly change of 57.08%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.