Company Reports

Compass Group is the largest foodservice firm globally and also provides support services to clients. Foodservices is its largest division, contributing 85%-90% of group revenue. Compass exited nine countries in 2024 to focus on its most profitable markets.

Compass reported third-quarter fiscal 2026 results in line with guidance, with organic revenue growth of 7.1% and net new business growth in its 4%-5% range. Client retention was strong at 96%. Management maintained fiscal 2026 guidance of 7% organic growth, 2% M&A growth, and margin progression.

Compass reported organic revenue growth of 7.2%, driven by strong retention and net business wins. As a result, management increased its guidance for underlying operating profit growth to 11% from 10%.

Effective April 1, Compass Group changed its ordinary share currency on the London Stock Exchange from British sterling penny (GBX) to US dollars (USD).

Compass Group is the largest foodservice firm globally and also provides support services to clients. Foodservices is its largest division, contributing 85%-90% of group revenue. Compass exited nine countries in 2024 to focus on its most profitable markets.

Compass Group is the largest foodservice firm globally and also provides support services to clients. Foodservices is its largest division, contributing 85%-90% of group revenue. Compass exited nine countries in 2024 to focus on its most profitable markets.

We lower our organic growth forecast on weakening prices and volume expansion. However, net new growth remains healthy, supporting our belief in Compass' long-term organic growth prospects and our undervalued fair value estimate.

Compass' first-quarter organic growth was in line with its guidance, expanding 7.3%. Net new business growth was steady, expanding in the 4% to 5% range.

Compass met full-year 2025 guidance, with the group expanding organic revenue 8.7% and achieving adjusted margins of 7.2%. Organic growth guidance for 2026 is slightly lower at 7%.

Compass Group is the largest foodservice firm globally and also provides support services to clients. Foodservices is its largest division, contributing 85%-90% of group revenue. Compass exited nine countries in 2024 to focus on its most profitable markets.

Compass Group posted solid third-quarter results, including 8.6% organic revenue growth. The company upgraded its full-year outlook and now expects organic revenue growth above 8% and operating profit growth of 11% at constant currency. It also announced an agreement to acquire Vermaat.

Compass reported strong first-half earnings, expanding organic revenue by 8.5%, driven by net new growth of 4.4%. The client retention rate was also strong at 96%. Management did not change its 2025 guidance floor of 7.5% revenue growth, but anticipates stronger performance for the year.

Compass Group is the largest food service firm globally and also provides support services to clients. Food services, its largest division, contributes 85% of group revenue. Compass exited nine countries in 2024 to focus on its most profitable markets.

Compass Group is the largest food service firm globally and also provides support services to clients. Food services, its largest division, contributes 85% of group revenue. Compass exited nine countries in 2024 to focus on its most profitable markets.

Narrow-moat Compass Group delivered a solid first-quarter fiscal 2025 trading update, growing organic revenue by 9%. Growth was broad-based, with all regions expanding by at least 7.5%. Management reaffirmed 2025 guidance of high-single-digit operating profit growth, organic revenue growth above 7.5%, and ongoing margin progression with which we are in line. However, if current spot rates stand, management anticipates a negative impact of $560 million on revenue and $36 million on operating profit. Compass Group shares screen as fairly valued relative to our GBX 2,550 fair value estimate.

Compass Group is the largest food service firm globally and also provides support services to clients. Food services, its largest division, contributes 85% of group revenue. Compass exited nine countries in 2024 to focus on its most profitable markets.

Narrow-moat Compass Group delivered strong full-year results for fiscal-year 2024. Organic revenue growth was 11%, aided by strong net new business growth in the second half of the year. Margins improved in all three regions, leading to 16% operating profit growth. We will update our model but do not anticipate any change to our fair value estimate. Compass Group shares screen as fairly valued relative to our GBX 2,550 fair value estimate.

We have raised our fair value estimate for Compass Group by 13% to GBX 2,550 per share following a transfer of coverage. Higher top-line growth assumptions are the largest driver of our revised valuation, more than offsetting higher spending. We are raising our Morningstar Capital Allocation Rating to Exemplary due to its strong organic investment decisions, supplemented by a history of strong bolt-on acquisitions. We retain our Morningstar Uncertainty Rating of Medium. We assign Compass a narrow moat rating due to high switching costs and cost advantages from scale. The firm’s switching costs are supported by long-term contracts and client time and monetary costs from mobilization, evidenced by its high retention rates. Its cost advantages are derived from scale, which it uses to deliver industry-leading margins and take market share.

Compass Group is the largest food service firm globally and also provides support services to clients. Food services, its largest division, contributes 85% of group revenue. Compass exited nine countries in 2023 to focus on its most profitable markets.

Compass Group is the largest food-service provider internationally and one of the most entrenched. Its extensive footprint serves a diversified mix of sectors and geographies, providing the foundation for a narrow economic moat that generates consistent revenue streams and healthy cash flow. Combining this dynamic with an asset-light operating structure leads to strong returns on invested capital. Demand for Compass' services is moderately tied to both consumer and enterprise-level discretionary spending, which adds some cyclicality. Nevertheless, Compass appears well positioned to grow as enterprise-level outsourcing gains traction for the longer term.