Buy Vestis: Uniform Provider Vestis Has Split Off from Aramark; Its Stock Is a Buy. Vestis looks poised to compete with industry leader Cintas. - Barron's - SCW NewsWatch
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Barron's reports on uniform provider Vestis, which has split off from Aramark so that Aramark can focus on its food-services business.
Vestis has gone public, and Barron's recommends buying Vestis stock.
"... Vestis (VSTS) ... was spun out from Aramark (ARMK) ... in early October .... Aramark Uniform Services segment became the independent Vestis — with its own management team and pitch to investors. ... Vestis stock has fallen 13%, to $16.79, since ... Oct. 2, while Aramark has gained 13%. ...[T]here’s a lot to like about Vestis, starting with ... uniform[]rental .... Some jobs require protective or technical apparel ... [S]tandardized uniforms convey a consistent brand image .... Outsourcing [uniforms, laundering and uniform maintainance] ... to a provider like Vestis can reduce complexity and cost. ... For Vestis, the business brings recurring revenue, economies of scale, and ample room for growth. The company’s trucks visit ... 300,000 customer locations ... week[ly], [for a cycle of uniform exchange and servicing] ... [returning to] 350 facilities [for] ... inspect[ion], launder[ing], and [as-needed] repair[] or replace[ment] ...."
As a unit of Aramark, the Vestis 2022 fiscal year ended last September. Long contracts with customers provided 92% of the unit's revenue, and 93% of clients renew.
Click here for: "This Uniform Provider Has Gone Solo. Its Stock Is a Buy. Vestis was just spun out from Aramark, and now looks poised to compete with industry leader Cintas." - Barron's 11.3.23
Key Words: Aramark, Vestis, Stocks, Stock Tips, Investment Recommendations, Uniforms
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