Compass Group PLC
CPG: XLON (GBR)
| Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
|---|---|---|---|
| GBX 3,493.00 | Pwmlskp | Ljzfmgjdw |
Compass Group Momentum Carrying Through Into 2024
Business Strategy and Outlook
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.