Don’t Be A Stock Market Victim: Aramark (ARMK), TransEnterix Inc. (TRXC)

Aramark (NYSE: ARMK) shares are -36.50% down in the year-to-date (YTD) period and have moved -4.34% or -$1.25 lower in the latest trading session. However, stock’s trailing 12-month performance remains nearly +185.60% lower. Comparatively, the stock is -41.63% down YTD and 3.84% over the trailing 3-month period. If we look at the shorter duration, its week performance is 7.45% and 30.49% over the month.

Analyst Recommendations

On June 10, 2020, Bernstein recommended the ARMK stock is a Mkt Perform, while earlier, RBC Capital Mkts had Downgrade the stock as a Sector Perform on July 16, 2020. 14 analysts offering the recommendations for the stock have a consensus rating of 2.30 to suggest that the ARMK stock is a “Moderate Buy. 0 of the 14 analysts rate the stock as a “Sell”, while 0 has rated it as “Underweight”. 6 recommend buying, with 0 rating it as an Overweight.

The stock currently trades at $27.56 and analysts tracking its performance over the next 12 months have a consensus estimate price target of $28.62. The forecasts give the Aramark stock a price target range of $42.00 on the higher side while at least one analyst think the stock could plunge to a low of $23.00. The two limits represent an upside potential of 34.38% or -19.83%.

Earnings Forecast

Analysts estimate the earnings to decrease -4.50% in the current quarter to -$0.25, down from the $0.69 reported in the same quarter a year ago. For the current year, earnings should grow to an average of -$0.05, down -20.80% from $2.27 reported last year. Analysts also offered guidance for the next financial quarter, with their average projected EPS at between -$0.39 and $0.43. Wall Street estimates earnings per share to be at an average of $0.79 for the next year.

Insider Transactions Summary

According to SEC data, total insider shares purchases at the company stands at 102 over the last 12 months, while SEC filings reveal that there have been 30 insider sales over the same period. Insiders have purchases 22,316,696 shares while those sold by company executives and officers stand at 1,192,609. The last 3 months have seen insiders trade a total of 9,178 and 5,208 in purchases and sales respectively.

Bethel Keith, a Chief Growth Officer at the company, sold 12,829 shares worth $0.35 million at $27.56 per share on May 28. The Chief Growth Officer had earlier sold another 5,000 ARMK shares valued at $0.14 million on Jun 03. The shares were sold at $28.02 per share. Ondrof Thomas Gerard (Executive VP and CFO) bought 10,000 shares at $24.99 per share on May 08 for a total of $0.25 million while King Karen Marie, (Director) bought 5,100 shares on Mar 23 for $97920.0 with each share fetching $19.20.

TransEnterix Inc. (AMEX:TRXC), on the other hand, is trading around $0.40 with a market cap of $40.67M and analyst research firms have a negative stance on its shares. Some analysts are even forecasting -$1 per share in earnings this year on a short term (1 year) basis.

Let us briefly look at the TransEnterix Inc. (TRXC) financials, with a focus on its operating details as indicated in its earnings report for the last quarter.

Company balance sheet and cash flow

TRXC’s operating expenses over the recent quarter were at $14.02 million. This represented a -2040.61% of the company’s total revenues which amounted $0.66 million. With this in place, we can see that the company’s diluted EPS declined -$0.27 on the year-over-year period, shrinking to -$1.35 as given in the last earnings report.

In terms of the balance sheet & cash flow as of (Sep 2020), the total assets figure advanced to $75.97 million from $84.23 million over the previous quarter. The cash flow from operating activities totaled -$25.14 million, significantly higher than the -$39.54 million reported in the year-ago quarter. The company’s free cash flow for the quarter was -$25.14 million.

Insider activity

Insiders have transacted a total of 14 times at TransEnterix Inc. over the last 6 months, with insider purchases undertaken 13 times and accounting for 340,233 shares. Insider sales totaled 131,102 shares over the same period, with these deals completed in 1 transactions. Looking at these numbers, we realize that net purchases over that period are 12.0 shares. Insiders now hold a total of 8.22M shares after the latest sales, with 4.30% net shares purchased.

Major holders

Insiders own 0.70% of the company shares, while shares held by institutions stand at 5.60% with a share float percentage of 79.41M. Investors are also buoyed by the number of investors in a company, with TransEnterix Inc. having a total of 125 institutions that hold shares in the company.