Compass Group PLC (LSE:CPG) shares fell to a seven-month low despite the catering giant reporting better-than-expected results for the past year.
The FTSE 100 group posted results for the year to 30 September 2025 showing revenue of $46.1 billion, ahead of the $45.4 billion consensus, with organic revenue growth of 8.7%.
Underlying operating profit increased 11.7% to $3,335 million, exceeding the $3,309 million forecast.
Fourth-quarter organic revenue growth was estimated at around 9.0%, with North America leading at 9.5%. Retention remained high at 96.3%, with net new business contributing 4.5% growth. Net debt stood at $6.4 billion with leverage at 1.4x EBITDA.
A full-year dividend of 65.9 cents per share was proposed.
For the new year, Compass guided to organic revenue growth of around 7% and underlying operating profit growth of 10%, with M&A expected to add a further 2%.
UBS analysts saisd: "The strong end to the year is a clear positive and while the guidance for organic revenue growth for FY26 is in line with expectations, the growth in profitability is ahead. We also believe this needs to be viewed though the lens of the past four years in which the company has consistently outperformed initial guidance.”
Broker Panmure Liberum noted that the stock had slipped in recent weeks towards the bottom half of its historic valuation range "but still looks fully valued" at 21.4 times forward earnings.