As of the morning of 11 December 2025, Compass Group PLC shares are quietly trading well below their 2025 highs, even as earnings, dividends and analyst forecasts all point in a more optimistic direction.
The FTSE‑listed catering giant’s stock is changing hands around 2,330p in London, down roughly 12.5% year‑to‑date and not far above its recent 52‑week low. [1] Yet consensus price targets from major brokers imply double‑digit upside, and the company has just cleared a key regulatory hurdle for its largest acquisition in history.
For investors scanning Google News or Discover for large‑cap “defensive growth” stories, Compass Group has become an intriguing mix of solid fundamentals, softer share price and diverging forecasts.
Share price under pressure despite resilient business
Compass Group’s share price has drifted lower through 2025, hitting a new one‑year low in late November when the stock traded down to GBX 2,344 and closed at 2,360p on heavy volume. [2] MarketBeat data shows the 52‑week range now sits at roughly 2,324p to 2,853p, with a market capitalisation around £40 billion and a trailing price‑to‑earnings ratio near 27.6x. [3]
By 06:29 EST on 11 December, real‑time Cboe Europe data had the shares at 2,330.5p, up 0.5% on the day but still well below both the 50‑ and 200‑day moving averages and down more than 12% since 1 January 2025. [4]
In other words, the stock price is telling a story of fatigue just as the business itself is printing near‑record numbers.
FY25: double‑digit profit growth and higher dividend
On 25 November 2025, Compass reported full‑year results for the year to 30 September 2025 that comfortably confirmed its post‑pandemic recovery. Key underlying figures (in US dollars, the company’s reporting currency) were: [5]
- Revenue: $46.1 billion, up 8.7% organically year on year
- Underlying operating profit: $3,335 million, up 11.7% on a constant‑currency basis
- Underlying operating margin:7.2%, with the second half at 7.3%
- Underlying free cash flow: $1,975 million, with an 88% cash conversion rate
- Underlying EPS: 131.9c, up 11.1%
- Annual dividend per share:65.9c, up 10.2% from 59.8c
A separate filing and MarketScreener summary specify that the Board has proposed a final dividend of 43.3c per share (vs 39.1c a year earlier), to be paid on 26 February 2026 to shareholders on the register on 16 January 2026. That takes the total FY25 dividend to 65.9c. [6]
Chief executive Dominic Blakemore described 2025 as “another strong year”, highlighting that net new business growth—new contracts minus losses—remained in the company’s 4–5% target range for the fourth year running, with client retention above 96%. [7]
From a fundamental perspective, this is classic Compass: modest but reliable revenue growth, margin creep and robust cash generation, which together fund both dividends and a steady diet of acquisitions.
North America continues to do the heavy lifting
Compass Group’s results confirm that North America remains the engine of growth:
- North America organic revenue grew 9.1% in FY25
- International (Europe and Rest of World) grew 7.7% [8]
Reuters notes that strong demand for workplace dining, particularly in the United States, and new business wins—including a high‑profile contract at J.P. Morgan’s new headquarters in New York—helped Compass deliver revenue and profit slightly ahead of consensus expectations. [9]
For FY25 as a whole, the group generated:
- Revenue: $46.1 billion
- Underlying operating profit:$3.34 billion, beating analyst forecasts of $3.31 billion on $45.4 billion of revenue. [10]
The flip side is that Compass benefited materially from high inflation in prior years, which made price increases easier to pass through. With inflation now slowing, the company is guiding to more normalised growth.
Guidance: slower revenue growth, still double‑digit profit
Looking ahead, Compass expects revenue growth to moderate in FY26 as inflation cools and some of the price tailwind fades. In its own outlook statement and in comments to Reuters, management sets out a clear algorithm: [11]
- FY26 organic revenue growth: around 7%
- FY26 underlying operating profit growth: around 10%
- About 2 percentage points of profit growth from M&A, including Vermaat
- Ongoing margin progression over the medium term
- Longer term: mid‑to‑high single‑digit organic revenue growth with profit growing faster than revenue
Finance chief Petros Parras told analysts the slower revenue growth guidance largely reflects inflation falling faster than previously assumed, which in turn means Compass will pass some lower food and labour costs back to clients in the form of reduced price increases. [12]
That conservative tone is precisely what irritated some investors on the day of the results: Reuters reported that shares fell about 3% after the release, extending year‑to‑date losses beyond 10%, despite what RBC Capital Markets called “all solid stuff with good growth levels across the board.” [13]
Vermaat: a €1.5–1.8 billion bet on premium foodservice
A major pillar of Compass Group’s current investment case is its acquisition of Vermaat Groep, a European premium foodservice specialist.
- In July 2025, Compass agreed to buy Vermaat for roughly €1.5 billion including debt (about $1.75–1.8 billion), calling it the largest deal in the company’s history. [14]
- Vermaat focuses on high‑end locations like museums, art galleries and corporate offices in the Netherlands, France and Germany, and is expected to generate around €700 million of sales in 2025 with double‑digit margins. [15]
In its FY25 results release, Compass emphasised that Vermaat is part of a broader push to expand the addressable market to roughly $360 billion, and to deepen its capabilities in premium on‑site concepts and innovative retail formats across Europe. [16]
The regulatory overhang on this deal has now eased. On 10 December 2025, MT Newswires reported that the European Union approved Compass Group’s purchase of Vermaat Groep, clearing a key antitrust hurdle. [17] While transaction details remain behind a paywall, the headline confirmation itself is important: it reduces execution uncertainty around one of Compass’s biggest strategic bets of the decade.
Management says recent acquisitions, including Vermaat, are integrating ahead of schedule and already contributing to profit growth. [18]
New OTCQX listing opens the door to more US investors
Another tactical move in late 2025 was Compass Group’s upgrade on US over‑the‑counter markets.
On 25 November 2025, OTC Markets announced that Compass Group had qualified to trade on the OTCQX Best Market, upgrading from the Pink Limited Market. The company now trades in the US under the tickers CMPGY and CMPGF, giving American investors access to real‑time Level 2 quotes and standardised disclosure through OTC Markets. [19]
Chief executive Dominic Blakemore described the move as a way to “make ownership in our company more accessible” to US investors, pointing out that the United States is already Compass Group’s largest market. [20]
For US‑based shareholders and funds that cannot easily trade in London, the OTCQX upgrade is a small but meaningful catalyst: it facilitates cross‑border flows into the stock at a time when valuation has become more attractive.
Dividends, cash generation and balance sheet
Compass’s 10% dividend increase for FY25 underlines management’s confidence in the cash profile of the business. The proposed final dividend of 43.3c per share brings the total payout to 65.9c, up from 59.8c a year earlier, and implies a mid‑2% dividend yield at current exchange rates and share prices (exact yield depends on FX and the specific share line held). [21]
The company generated nearly $2.0 billion in underlying free cash flow in FY25, even after investing $1.5 billion in capex (3.3% of revenue) and about $1.3 billion in acquisitions. [22]
One area investors keep an eye on is leverage and liquidity. MarketBeat’s profile data shows: [23]
- Debt‑to‑equity ratio: roughly 0.87 (86.56%)
- Current ratio: around 0.74
- Quick ratio: about 0.86
Those metrics aren’t alarming for a stable, asset‑light service business with strong cash flow, but they do mean Compass is not running a fortress‑like balance sheet. It is a classic “investment grade but efficiently levered” profile rather than a debt‑free cash hoarder.
Where analysts stand on Compass Group stock
Across several data providers, analyst sentiment on Compass Group is broadly positive:
- LSE‑listed CPG (London) – MarketBeat:
- Consensus rating: “Buy”, based on 7 analyst ratings
- Average 12‑month price target:2,979p
- Target range: 2,775p–3,100p
- Implied upside: about 28% from the 2,325p reference price used by MarketBeat. [24]
- LSE CPG – TradingView:
- Average 1‑year target: about 2,878.6p
- Target range: 2,176.8p–3,158.4p
- Analyst rating: overall “Buy”, based on opinions from 20 analysts over the past three months. [25]
- CMPGF (US OTC) – Nasdaq/Fintel:
- As of 6 December, Fintel reported an average one‑year target of $39.60 per share, with forecasts ranging from about $30.14 to $44.94.
- That represents roughly 39.9% upside from the latest closing price of $28.31 for CMPGF. [26]
- Global USD view – MarketScreener:
- Based on 19 analysts, the mean consensus rating is “Outperform”.
- Last close: $30.91 (for the relevant US‑traded line).
- Average target price: $37.72, implying around 22% upside. [27]
On top of this, we’ve seen a flurry of positive rating actions in late 2025:
- Berenberg Bank raised its price target from 3,000p to 3,100p on 6 December and reiterated a “Buy” rating, noting roughly 30.8% upside from the prior close. [28]
- Royal Bank of Canada recently upgraded Compass Group to “Outperform” and lifted its target from 2,700p to 2,775p. [29]
- Citigroup, Deutsche Bank, Jefferies and JPMorgan have all either upgraded the stock or raised their price targets over the past few months, with targets clustering between 2,775p and 3,100p. [30]
Taken together, the broker community is effectively saying: the business is high‑quality, growth is slowing but still healthy, and the recent share price slide has opened up a reasonable valuation gap.
Quant models paint a more cautious short‑term picture
While human analysts are mostly bullish, algorithmic and model‑based forecasts are more mixed.
For the US‑traded CMPGF line, StockScan’s automated models currently show: [31]
- A 30‑day outlook with an average target of $25.47, implying almost 20% downside from a reference price of $31.77
- A 12‑month average target of $24.28, again suggesting double‑digit downside
- Long‑term projections that gradually rise, with indicative averages of about $29.20 by 2030, $33.63 by 2040 and $40.77 by 2050
StockScan flags these as purely model‑driven scenarios rather than fundamental analyst opinions, and its long‑dated forecasts should not be taken as precise predictions. Still, the contrast is striking: while traditional brokers see upside from current levels, some quantitative tools warn of the risk of further near‑term weakness before a longer‑term climb.
Key risks and what to watch in 2026
Even fans of Compass Group usually concede a few clear risk factors:
- Slower inflation and pricing power
Inflation is now falling faster than the company previously assumed, which means less room for price increases. Management explicitly says lower costs will be partly passed back to clients, which moderates the revenue line even if volumes hold up. [32] - Execution risk on Vermaat and other M&A
Large acquisitions can go wrong. Although Compass has a strong integration track record and says acquisitions are ahead of schedule, Vermaat is both sizeable and strategically important. Successful integration is crucial for delivering the extra ~2 percentage points of profit growth embedded in FY26 guidance. [33] - Balance‑sheet flexibility
With a debt‑to‑equity ratio nearing 0.9, Compass is not dangerously geared, but it has less room than some peers to absorb a prolonged downturn without adjusting capex, M&A or shareholder returns. [34] - Cyclical exposure
While food services to hospitals and schools are relatively defensive, segments like Business & Industry and Sports & Leisure remain sensitive to office occupancy, corporate spending and event traffic. A weak macro backdrop in 2026 could crimp volumes.
The next major signposts for the story will be:
- Trading updates showing whether organic growth remains close to the 7% FY26 target, particularly in North America
- Evidence that Vermaat is integrating smoothly and growing as expected
- Dividend decisions beyond FY26 and any change to the company’s long‑term “mid‑to‑high single‑digit growth” algorithm
Bottom line: a quality compounder going through a valuation reset
Compass Group today sits in a classic large‑cap “quality compounder” bucket:
- Global market leader in outsourced food services
- High client retention, strong free cash flow and a rising dividend
- Clear profitability and growth framework
- Strategic M&A that expands its premium offerings and geographic reach
Yet the share price is still digesting the transition from inflation‑turbocharged growth to more normalised mid‑single‑digit expansion. Guidance that is “solid but not exciting” has weighed on sentiment, even as the balance of news—EU approval for Vermaat, an OTCQX upgrade, a higher dividend and multiple analyst upgrades—has been broadly positive. [35]
For now, the market seems to be pricing in that slowdown more aggressively than brokers are. Whether Compass Group’s stock ultimately follows the analyst playbook of 20–30% upside, or the more cautious path suggested by some quantitative models, will depend largely on how convincingly the company can keep converting its scale and contract wins into durable, inflation‑agnostic growth in 2026 and beyond.
References
1. www.marketscreener.com, 2. www.marketbeat.com, 3. www.marketbeat.com, 4. www.marketscreener.com, 5. www.compass-group.com, 6. www.marketscreener.com, 7. www.compass-group.com, 8. www.compass-group.com, 9. www.reuters.com, 10. www.reuters.com, 11. www.compass-group.com, 12. www.reuters.com, 13. www.reuters.com, 14. www.reuters.com, 15. www.reuters.com, 16. www.compass-group.com, 17. www.marketscreener.com, 18. www.compass-group.com, 19. www.stocktitan.net, 20. www.stocktitan.net, 21. www.marketscreener.com, 22. www.compass-group.com, 23. www.marketbeat.com, 24. www.marketbeat.com, 25. www.tradingview.com, 26. www.nasdaq.com, 27. www.marketscreener.com, 28. www.marketbeat.com, 29. www.marketbeat.com, 30. www.marketbeat.com, 31. stockscan.io, 32. www.reuters.com, 33. www.compass-group.com, 34. www.marketbeat.com, 35. www.reuters.com
