Vestis: Shares Are Cheap, But They Probably Deserve To Be

Daniel JonesInvesting Group LeaderFollow5ShareSavePlay(8min)CommentsSummaryVestis Corporation trades at a discount due to weak financial performance and ongoing revenue declines post-Aramark spin-off.Management targets $75 million in cost savings and expects EBITDA to rise to $285–$315 million despite flat or declining revenue.VSTS remains the cheapest among uniform industry peers, but its high net leverage ratio of 4.23 and lack of growth justify caution.I rate VSTS a “Hold” until evidence of operational turnaround materializes, despite its attractive valuation.Looking for a helping hand in the market? Members of Crude Value Insights get exclusive ideas and guidance to navigate any climate. Learn More » Klaus Vedfelt/DigitalVision via Getty Images For quite some time now, I have been a fan of companies that are involved in the uniform and facilities services industries. They appeal to a wide range of the economy. And that provides some degree of stability, especially when you consider that notThis article was written byDaniel Jones36.86K FollowersFollowDaniel is an avid and active professional investor. He runs Crude Value Insights, a value-oriented newsletter aimed at analyzing the cash flows and assessing the value of companies in the oil and gas space. His primary focus is on finding businesses that are trading at a significant discount to their intrinsic value by employing a combination of Benjamin Graham's investment philosophy and a contrarian approach to the market and the securities therein. Learn more.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.