Reviewing Aramark (NYSE:ARMK) & IBEX (NASDAQ:IBEX)

IBEX (NASDAQ:IBEX) and Aramark (NYSE:ARMK) are both business services companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, dividends, valuation and institutional ownership.

Insider and Institutional Ownership

81.2% of IBEX shares are owned by institutional investors. 3.4% of IBEX shares are owned by company insiders. Comparatively, 2.8% of Aramark shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk and Volatility

IBEX has a beta of 0.69, indicating that its stock price is 31% less volatile than the S&P 500. Comparatively, Aramark has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations for IBEX and Aramark, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
IBEX	0	3	0	0	2.00
Aramark	0	2	8	0	2.80

IBEX currently has a consensus target price of $35.00, suggesting a potential upside of 17.77%. Aramark has a consensus target price of $48.67, suggesting a potential upside of 7.44%. Given IBEX’s higher possible upside, equities analysts plainly believe IBEX is more favorable than Aramark.

Earnings and Valuation

This table compares IBEX and Aramark”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
IBEX	$558.27 million	0.71	$36.86 million	$3.04	9.78
Aramark	$18.51 billion	0.64	$326.39 million	$1.19	38.06

Aramark has higher revenue and earnings than IBEX. IBEX is trading at a lower price-to-earnings ratio than Aramark, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares IBEX and Aramark’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
IBEX	7.35%	31.70%	15.65%
Aramark	1.69%	16.15%	3.75%

Summary

IBEX beats Aramark on 8 of the 14 factors compared between the two stocks.

About IBEX

IBEX Limited provides end-to-end technology-enabled customer lifecycle experience solutions in the United States and internationally. The company products and services portfolio includes ibex Connect, that offers customer service, technical support, revenue generation, and other revenue generation outsourced back-office services through the CX model, which integrates voice, email, chat, SMS, social media, and other communication applications; ibex Digital, a customer acquisition solution that comprises digital marketing, e-commerce technology, and platform solutions; and ibex CX, a customer experience solution, which provides a suite of proprietary software tools to measure, monitor, and manage its clients' customer experience. It operates customer engagement and customer acquisition delivery centers. The company serves banking and financial services, delivery and logistics, health tech and wellness, high tech, retail and e-commerce, streaming and entertainment, travel and hospitality, and utility industries. The company was formerly known as IBEX Holdings Limited and changed its name to IBEX Limited in September 2019. IBEX Limited was incorporated in 2017 and is headquartered in Washington, District of Columbia. The company is a subsidiary of The Resource Group International Limited.

About Aramark

Aramark provides food and facilities services to education, healthcare, business and industry, sports, leisure, and corrections clients in the United States and internationally. It operates through two segments, Food and Support Services United States, and Food and Support Services International. The company offers food-related managed services, including dining, catering, food service management, and convenience-oriented retail services; non-clinical food and food-related support services, such as patient food and nutrition, retail food, environmental services, and procurement services; and plant operations and maintenance, custodial/housekeeping, energy management, grounds keeping, and capital project management services. It also provides on-site restaurants, catering, convenience stores, and executive dining services; beverage and vending services; and facility management services comprising landscaping, transportation, capital program management, payment services, and other facility consulting services relating to building operations. In addition, the company offers concessions, banquet, and catering services; retail services and merchandise sale, recreational, and lodging services; and facility management services at sports, entertainment, and recreational facilities. Further, it offers correctional food; and operates commissaries, laundry facilities, and property rooms. It primarily serves business and industry, sports, leisure and corrections, education, healthcare, public institutions, manufacturing, transportation, service, and other industries. The company was formerly known as ARAMARK Holdings Corporation. Aramark was founded in 1959 and is based in Philadelphia, Pennsylvania.