ARC Document Solutions Inc (ARC) Stock Fundamental Analysis
NYSE:ARC - New York Stock Exchange, Inc. - US00191G1031 - Common Stock - Currency: USD
Taking everything into account, ARC scores 5 out of 10 in our fundamental rating. ARC was compared to 84 industry peers in the Commercial Services & Supplies industry. ARC has an average financial health and profitability rating. ARC has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year ARC was profitable.
ARC had a positive operating cash flow in the past year.
ARC had positive earnings in each of the past 5 years.
Each year in the past 5 years ARC had a positive operating cash flow.
1.2 Ratios
ARC's Return On Assets of 1.49% is in line compared to the rest of the industry. ARC outperforms 52.38% of its industry peers.
With a Return On Equity value of 3.01%, ARC perfoms like the industry average, outperforming 52.38% of the companies in the same industry.
The Return On Invested Capital of ARC (3.76%) is comparable to the rest of the industry.
ARC had an Average Return On Invested Capital over the past 3 years of 4.64%. This is significantly below the industry average of 11.59%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.49% | ||
| ROE | 3.01% | ||
| ROIC | 3.76% |
ROA(3y)3.03%
ROA(5y)2.34%
ROE(3y)6.17%
ROE(5y)4.96%
ROIC(3y)4.64%
ROIC(5y)4.07%
1.3 Margins
With a Profit Margin value of 1.61%, ARC perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
ARC's Profit Margin has improved in the last couple of years.
ARC has a Operating Margin (4.78%) which is comparable to the rest of the industry.
ARC's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 33.23%, ARC perfoms like the industry average, outperforming 54.76% of the companies in the same industry.
ARC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.78% | ||
| PM (TTM) | 1.61% | ||
| GM | 33.23% |
OM growth 3Y14.39%
OM growth 5Y7.5%
PM growth 3Y10.99%
PM growth 5Y5.69%
GM growth 3Y1.52%
GM growth 5Y0.55%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ARC is destroying value.
Compared to 1 year ago, ARC has less shares outstanding
The number of shares outstanding for ARC has been reduced compared to 5 years ago.
ARC has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 1.96 indicates that ARC is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 1.96, ARC is in line with its industry, outperforming 45.24% of the companies in the same industry.
ARC has a debt to FCF ratio of 3.13. This is a good value and a sign of high solvency as ARC would need 3.13 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.13, ARC is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
A Debt/Equity ratio of 0.34 indicates that ARC is not too dependend on debt financing.
ARC's Debt to Equity ratio of 0.34 is fine compared to the rest of the industry. ARC outperforms 63.10% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 3.13 | ||
| Altman-Z | 1.96 |
ROIC/WACC0.56
WACC6.71%
2.3 Liquidity
ARC has a Current Ratio of 1.49. This is a normal value and indicates that ARC is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of ARC (1.49) is comparable to the rest of the industry.
ARC has a Quick Ratio of 1.37. This is a normal value and indicates that ARC is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of ARC (1.37) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.49 | ||
| Quick Ratio | 1.37 |
3. Growth
3.1 Past
ARC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -29.63%.
Measured over the past years, ARC shows a decrease in Earnings Per Share. The EPS has been decreasing by -1.09% on average per year.
ARC shows a small growth in Revenue. In the last year, the Revenue has grown by 2.86%.
The Revenue has been decreasing by -6.84% on average over the past years.
EPS 1Y (TTM)-29.63%
EPS 3Y10.6%
EPS 5Y-1.09%
EPS Q2Q%-100%
Revenue 1Y (TTM)2.86%
Revenue growth 3Y-0.96%
Revenue growth 5Y-6.84%
Sales Q2Q%4.77%
3.2 Future
Based on estimates for the next years, ARC will show a very negative growth in Earnings Per Share. The EPS will decrease by -18.74% on average per year.
ARC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.14% yearly.
EPS Next Y-22.31%
EPS Next 2Y-18.74%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year4.63%
Revenue Next 2Y4.14%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 17.84, ARC is valued on the expensive side.
73.81% of the companies in the same industry are more expensive than ARC, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.03, ARC is valued a bit cheaper.
ARC is valuated rather expensively with a Price/Forward Earnings ratio of 19.74.
ARC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ARC is cheaper than 71.43% of the companies in the same industry.
ARC is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 36.28, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.84 | ||
| Fwd PE | 19.74 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ARC is valued cheaply inside the industry as 92.86% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, ARC is valued cheaper than 94.05% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.76 | ||
| EV/EBITDA | 5.15 |
4.3 Compensation for Growth
ARC's earnings are expected to decrease with -18.74% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-18.74%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.90%, ARC is a good candidate for dividend investing.
ARC's Dividend Yield is rather good when compared to the industry average which is at 2.51. ARC pays more dividend than 100.00% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, ARC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.9% |
5.2 History
ARC has been paying a dividend for over 5 years, so it has already some track record.
ARC has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
ARC pays out 181.67% of its income as dividend. This is not a sustainable payout ratio.
DP181.67%
EPS Next 2Y-18.74%
EPS Next 3YN/A
3.39
0 (0%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners49.24%
Inst Owner Change0%
Ins Owners1.73%
Ins Owner Change0%
Market Cap146.65M
Analysts84
Price Target4.44 (30.97%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.9% |
Yearly Dividend0.2
Dividend Growth(5Y)N/A
DP181.67%
Div Incr Years4
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-47.19%
Min EPS beat(2)-100%
Max EPS beat(2)5.61%
EPS beat(4)2
Avg EPS beat(4)-18.09%
Min EPS beat(4)-100%
Max EPS beat(4)32.01%
EPS beat(8)3
Avg EPS beat(8)-9.54%
EPS beat(12)6
Avg EPS beat(12)-0.4%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)1.7%
Min Revenue beat(2)1.39%
Max Revenue beat(2)2%
Revenue beat(4)4
Avg Revenue beat(4)1.48%
Min Revenue beat(4)0.84%
Max Revenue beat(4)2%
Revenue beat(8)4
Avg Revenue beat(8)-0.7%
Revenue beat(12)7
Avg Revenue beat(12)0.21%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)-18.69%
EPS NQ rev (1m)-66.67%
EPS NQ rev (3m)-66.67%
EPS NY rev (1m)-25.93%
EPS NY rev (3m)-25.93%
Revenue NQ rev (1m)4.13%
Revenue NQ rev (3m)4.13%
Revenue NY rev (1m)1.25%
Revenue NY rev (3m)2.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.84 | ||
| Fwd PE | 19.74 | ||
| P/S | 0.51 | ||
| P/FCF | 7.76 | ||
| P/OCF | 4.46 | ||
| P/B | 0.95 | ||
| P/tB | 4.33 | ||
| EV/EBITDA | 5.15 |
EPS(TTM)0.19
EY5.6%
EPS(NY)0.17
Fwd EY5.06%
FCF(TTM)0.44
FCFY12.89%
OCF(TTM)0.76
OCFY22.43%
SpS6.69
BVpS3.58
TBVpS0.78
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.49% | ||
| ROE | 3.01% | ||
| ROCE | 5.79% | ||
| ROIC | 3.76% | ||
| ROICexc | 4.79% | ||
| ROICexgc | 13.53% | ||
| OM | 4.78% | ||
| PM (TTM) | 1.61% | ||
| GM | 33.23% | ||
| FCFM | 6.54% |
ROA(3y)3.03%
ROA(5y)2.34%
ROE(3y)6.17%
ROE(5y)4.96%
ROIC(3y)4.64%
ROIC(5y)4.07%
ROICexc(3y)6.02%
ROICexc(5y)5.13%
ROICexgc(3y)17.47%
ROICexgc(5y)13.75%
ROCE(3y)7.15%
ROCE(5y)6.28%
ROICexcg growth 3Y29.73%
ROICexcg growth 5Y10.98%
ROICexc growth 3Y19.41%
ROICexc growth 5Y4.78%
OM growth 3Y14.39%
OM growth 5Y7.5%
PM growth 3Y10.99%
PM growth 5Y5.69%
GM growth 3Y1.52%
GM growth 5Y0.55%
F-Score5
Asset Turnover0.92
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 3.13 | ||
| Debt/EBITDA | 1.74 | ||
| Cap/Depr | 86.39% | ||
| Cap/Sales | 4.84% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 109.63% | ||
| Profit Quality | 405.82% | ||
| Current Ratio | 1.49 | ||
| Quick Ratio | 1.37 | ||
| Altman-Z | 1.96 |
F-Score5
WACC6.71%
ROIC/WACC0.56
Cap/Depr(3y)34.84%
Cap/Depr(5y)33.2%
Cap/Sales(3y)2.4%
Cap/Sales(5y)2.56%
Profit Quality(3y)316.5%
Profit Quality(5y)611.06%
High Growth Momentum
Growth
EPS 1Y (TTM)-29.63%
EPS 3Y10.6%
EPS 5Y-1.09%
EPS Q2Q%-100%
EPS Next Y-22.31%
EPS Next 2Y-18.74%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)2.86%
Revenue growth 3Y-0.96%
Revenue growth 5Y-6.84%
Sales Q2Q%4.77%
Revenue Next Year4.63%
Revenue Next 2Y4.14%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-25.32%
EBIT growth 3Y13.28%
EBIT growth 5Y0.14%
EBIT Next Year74.29%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-35.91%
FCF growth 3Y-18.72%
FCF growth 5Y-8.42%
OCF growth 1Y-3.26%
OCF growth 3Y-12.44%
OCF growth 5Y-7.83%