Vestis Corporation (VSTS)
NYSE:VSTS
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Vestis Corporation
(NYSE:VSTS)
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Rating:64Neutral
Price Target:
$12.00
▲(21.33% Upside)
Action:Reiterated
Date:05/14/26
The score is driven by improving cash flow and a positive earnings-call trajectory (raised EBITDA and sharply higher free cash flow guidance), supported by strong technical momentum. These positives are tempered by weak recent profitability and revenue trends and a very high P/E that leaves limited valuation cushion.
Positive Factors
Contract-based recurring revenue model
Route-based, contracted uniform and facility services create durable, recurring revenue with high customer retention. Contracts and regular service visits support predictable cash flows, cross-sell of add‑ons, and lower churn versus transactional sellers, stabilizing revenue over multiple quarters.
Negative Factors
Recent revenue decline and TTM net loss
A sharp top-line decline and recent trailing‑twelve‑month net loss indicate underlying demand or mix weakness. Persistent revenue contraction reduces leverage benefits, curtails margin recovery potential, and makes sustained profitability contingent on reversing the sales trend.
Read all positive and negative factors
Positive Factors
Negative Factors
Contract-based recurring revenue model
Route-based, contracted uniform and facility services create durable, recurring revenue with high customer retention. Contracts and regular service visits support predictable cash flows, cross-sell of add‑ons, and lower churn versus transactional sellers, stabilizing revenue over multiple quarters.
Read all positive factors
Vestis Corporation Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where Vestis is strongest and where it may face risk or growth potential due to local economic conditions, market share shifts, or concentration in a small number of markets.
Breaks down revenue across different regions, revealing where Vestis is strongest and where it may face risk or growth potential due to local economic conditions, market share shifts, or concentration in a small number of markets.
Data provided by:
The Fly
The FlyVestis Corporation (VSTS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.55B
Dividend Yield2.09%
Average Volume (3M)2.87M
Price to Earnings (P/E)99.5
Beta (1Y)1.06
Revenue Growth-0.84%
EPS Growth29.88%
CountryUS
Employees19,600
SectorIndustrials
Sector Strength72
IndustryRental & Leasing Services
Share Statistics
EPS (TTM)-0.13
Shares Outstanding132,105,090
10 Day Avg. Volume1,983,408
30 Day Avg. Volume2,871,422
Financial Highlights & Ratios
PEG Ratio0.06
Price to Book (P/B)0.77
Price to Sales (P/S)0.24
P/FCF Ratio115.33
Enterprise Value/Market Cap1.13
Enterprise Value/Revenue0.64
Enterprise Value/Gross Profit2.60
Enterprise Value/Ebitda8.09
Forecast
1Y Price Target
$10.38Price Target Upside4.90% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)0.48
Revenue Forecast (FY)$2.66B
Vestis Corporation Business Overview & Revenue Model
Company Description
Vestis Corporation provides uniform rentals and workplace supplies in the United States and Canada. Its products include uniform options, such as shirts, pants, outerwear, gowns, scrubs, high visibility garments, particulate-free garments, and fla...
How the Company Makes Money
Vestis primarily makes money by providing recurring, contract-based services that bundle product supply with ongoing servicing. A core revenue stream is uniform rental programs: Vestis supplies uniforms and then provides regular pickup and deliver...
Vestis Corporation Earnings Call Summary
Earnings Call Date:May 12, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Positive
The call delivered materially positive operational and financial momentum: management reported the first YoY adjusted EBITDA growth in over two years, an improved cost-per-pound and operating leverage, strong free cash flow generation, and raised full-year guidance for both adjusted EBITDA and free cash flow. These achievements were supported by measurable operational improvements (on-time delivery, plant productivity, reduced customer complaints) and active balance-sheet actions (debt repayments, asset sales). Offsetting these positives are modest revenue and volume declines, remaining elevated net debt, prior-year one-offs that complicate comparability, and some one-time cash flow benefits that may not repeat. Management emphasized that top-line recovery depends on ongoing commercial execution and network optimization, with a projected return to growth in Q4 but without specific numeric visibility. Overall, the call reflects meaningful progress under the transformation plan with remaining execution and leverage risks to monitor.Positive Updates
Adjusted EBITDA Growth and Margin Expansion
Adjusted EBITDA for Q2 was $74.5 million, up approximately $12 million or ~19% year-over-year on a covenant-adjusted basis; adjusted EBITDA margin improved to 11.3% versus 7.2% in the prior year (9.4% on a comparable adjusted basis).
Negative Updates
Revenue Decline and Volume Reduction
Total revenue for Q2 was ~$659 million, down about $6 million or ~0.9% year-over-year (including a ~$2.7M favorable FX impact). Pounds processed declined ~1.2% year-over-year (approximately 6 million pounds lost).
Read all updates
Q2-2026 Updates
Positive
Negative
Adjusted EBITDA Growth and Margin Expansion
Adjusted EBITDA for Q2 was $74.5 million, up approximately $12 million or ~19% year-over-year on a covenant-adjusted basis; adjusted EBITDA margin improved to 11.3% versus 7.2% in the prior year (9.4% on a comparable adjusted basis).
Read all positive updates
Company Guidance
Vestis raised full‑year fiscal 2026 guidance, now targeting adjusted EBITDA of $295–325 million (midpoint $310M vs prior $285–315M / prior midpoint $300M), with ~5% sequential growth in Q3 and another 5–10% in Q4 (management noted an implied Q4 run‑rate of roughly ~$90M); they now expect in‑year transformation benefits of ~$50M (up $10M from prior $40M), which management said translates to at least ~$75M on a full‑year run‑rate into FY2027. Free cash flow guidance was increased to $120–150M (midpoint ~$135M) from $50–60M previously, assuming $60–70M of cash CapEx and $30–35M of cash transformation spend; YTD through six months FCF was ~$74M (a $92M improvement vs H1 FY25), Q2 operating cash flow was $58.3M, Q2 free cash flow $45.6M (adjusted free cash flow $57M), and Q2 transformation cash was ~$11M (third‑party $7.2M, severance $3.9M). Balance sheet actions include net debt of $1.25B, principal bank debt $1.13B, $34M of debt repaid in Q2, Q2 capex investment $24.7M (cash $12.7M, finance leases $12.0M) and $39.5M YTD (cash $22.1M), with available liquidity of ~$344M (undrawn revolver $294M, cash ~$50M) and no maturities until 2028; revenue is still expected flat to down ~2% vs normalized FY25 (ex‑53rd week) and full‑year effective tax rate is guided to 35–40% (Q3 standalone low‑to‑mid‑40%).Vestis Corporation Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
63
Positive
Cash Flow
68
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.71B | 2.73B | 2.81B | 2.83B | 2.69B | 2.46B |
| Gross Profit | 671.27M | 724.76M | 815.95M | 855.07M | 777.33M | 690.94M |
| EBITDA | 215.70M | 190.97M | 299.37M | 408.34M | 328.86M | 229.54M |
| Net Income | -17.02M | -40.22M | 20.97M | 213.16M | 141.68M | 74.27M |
Balance Sheet | ||||||
| Total Assets | 2.87B | 2.91B | 2.93B | 3.16B | 3.13B | 3.11B |
| Cash, Cash Equivalents and Short-Term Investments | 50.34M | 29.75M | 31.01M | 36.05M | 23.74M | 41.11M |
| Total Debt | 262.14M | 1.42B | 1.38B | 1.69B | 182.18M | 181.58M |
| Total Liabilities | 2.01B | 2.04B | 2.03B | 2.28B | 797.20M | 776.40M |
| Stockholders Equity | 867.20M | 865.64M | 903.05M | 877.36M | 2.34B | 2.33B |
Cash Flow | ||||||
| Free Cash Flow | 97.44M | 5.77M | 392.88M | 179.11M | 156.40M | 154.20M |
| Operating Cash Flow | 149.73M | 64.23M | 471.79M | 256.98M | 232.85M | 244.34M |
| Investing Cash Flow | -44.28M | -19.82M | -73.64M | -14.75M | -86.13M | -103.16M |
| Financing Cash Flow | -83.69M | -46.06M | -402.98M | -230.27M | -162.54M | -125.51M |
Vestis Corporation Technical Analysis
Positive
9.89
Price Trends
9.16
Positive
8.17
Positive
6.72
Positive
Market Momentum
0.80
Negative
64.28
Neutral
74.57
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VSTS, the sentiment is Positive. The current price of 9.89 is below the 20-day moving average (MA) of 10.41, above the 50-day MA of 9.16, and above the 200-day MA of 6.72, indicating a bullish trend. The MACD of 0.80 indicates Negative momentum. The RSI at 64.28 is Neutral, neither overbought nor oversold. The STOCH value of 74.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VSTS.
Vestis Corporation Risk Analysis
Vestis Corporation disclosed 35 risk factors in its most recent earnings report. Vestis Corporation reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Vestis Corporation Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $2.70B | 25.10 | 12.84% | 1.79% | 3.14% | -34.73% | |
64 Neutral | $1.55B | 99.54 | -1.96% | 2.09% | -0.84% | 29.88% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
57 Neutral | $4.30B | 27.93 | -7.11% | 1.44% | -4.12% | -487.73% | |
56 Neutral | $4.43B | -34.53 | -0.26% | 1.79% | 28.39% | -105.83% | |
55 Neutral | $2.12B | -90.75 | -2.18% | ― | 9.38% | 43.77% | |
45 Neutral | $178.95M | -2.25 | -3253.61% | 4.88% | -1.86% | -13.02% |
* Industrials Sector Average
VSTS
Vestis Corporation
11.61
5.86
101.91%
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Vestis Corporation Corporate Events
Executive/Board ChangesShareholder Meetings
Vestis Shareholders Approve Directors, Pay and Auditor
Positive
Feb 24, 2026
Vestis Corporation reported the results of its 2026 Annual Meeting of Shareholders held on February 18, 2026, where investors voted on board composition, executive pay and auditor selection. Shareholders elected three directors—Tracy Jokinen...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.