Compass, the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Jamie Rollo from Morgan Stanley reiterated a Buy rating on the stock and has a p3,000.00 price target.
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Jamie Rollo has given his Buy rating due to a combination of factors that highlight Compass Group’s strong growth potential and operational resilience. The company’s strategic positioning in the outsourcing market is a significant advantage, as the demand for outsourced catering services continues to rise. Compass benefits from its scale and sector-specific strategies, which have enabled it to achieve a higher retention rate of contracts, particularly in Europe, supported by recent acquisitions. This positions Compass well for sustained organic sales growth in the coming years.
Additionally, Rollo sees a clear path for margin expansion, driven by operating leverage, synergies from acquisitions, and potential technological improvements. Despite potential risks associated with its high exposure to the US market, Compass’s overall business model remains robust. The company’s valuation is justified by its growth prospects, and the increased price target reflects the positive outlook. Rollo’s analysis suggests that Compass is well-positioned to deliver strong earnings growth, making it a compelling investment opportunity.
According to TipRanks, Rollo is a 2-star analyst with an average return of 0.0% and a 52.56% success rate. Rollo covers the Consumer Cyclical sector, focusing on stocks such as Carnival, Mitchells & Butlers, and InterContinental Hotels.
In another report released on October 3, Kepler Capital also maintained a Buy rating on the stock with a p2,950.00 price target.