ARCO PLATFORM LTD - CLASS A (ARCE)
KYG045531061 - Common Stock
Taking everything into account, ARCE scores 4 out of 10 in our fundamental rating. ARCE was compared to 65 industry peers in the Diversified Consumer Services industry. ARCE has a bad profitability rating. Also its financial health evaluation is rather negative. ARCE is valued quite expensive, but it does show an excellent growth.
1. Profitability
1.1 Basic Checks
ARCE had negative earnings in the past year.
ARCE had a negative operating cash flow in the past year.
In multiple years ARCE reported negative net income over the last 5 years.
The reported operating cash flow has been mixed in the past 5 years: ARCE reported negative operating cash flow in multiple years.
1.2 Ratios
The Return On Assets of ARCE (-0.52%) is comparable to the rest of the industry.
With a Return On Equity value of -1.22%, ARCE perfoms like the industry average, outperforming 56.06% of the companies in the same industry.
ARCE's Return On Invested Capital of 3.15% is fine compared to the rest of the industry. ARCE outperforms 66.67% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ARCE is significantly below the industry average of 15.00%.
The 3 year average ROIC (2.64%) for ARCE is below the current ROIC(3.15%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.52% | ||
| ROE | -1.22% | ||
| ROIC | 3.15% |
ROA(3y)-0.53%
ROA(5y)-1.61%
ROE(3y)-1.86%
ROE(5y)-2.77%
ROIC(3y)2.64%
ROIC(5y)2.4%
1.3 Margins
In the last couple of years the Profit Margin of ARCE has declined.
Looking at the Operating Margin, with a value of 13.91%, ARCE is in the better half of the industry, outperforming 78.79% of the companies in the same industry.
In the last couple of years the Operating Margin of ARCE has declined.
ARCE's Gross Margin of 66.71% is fine compared to the rest of the industry. ARCE outperforms 75.76% of its industry peers.
In the last couple of years the Gross Margin of ARCE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.91% | ||
| PM (TTM) | N/A | ||
| GM | 66.71% |
OM growth 3Y17.55%
OM growth 5Y-11.49%
PM growth 3YN/A
PM growth 5Y-34.26%
GM growth 3Y-3.35%
GM growth 5Y-1.14%
2. Health
2.1 Basic Checks
ARCE has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, ARCE has about the same amount of shares outstanding.
ARCE has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, ARCE has a worse debt to assets ratio.
2.2 Solvency
ARCE has an Altman-Z score of 1.84. This is not the best score and indicates that ARCE is in the grey zone with still only limited risk for bankruptcy at the moment.
ARCE has a Altman-Z score of 1.84. This is in the better half of the industry: ARCE outperforms 63.64% of its industry peers.
ARCE has a Debt/Equity ratio of 0.67. This is a neutral value indicating ARCE is somewhat dependend on debt financing.
ARCE has a Debt to Equity ratio of 0.67. This is in the lower half of the industry: ARCE underperforms 65.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.84 |
ROIC/WACC0.23
WACC13.98%
2.3 Liquidity
ARCE has a Current Ratio of 1.26. This is a normal value and indicates that ARCE is financially healthy and should not expect problems in meeting its short term obligations.
ARCE has a Current ratio (1.26) which is comparable to the rest of the industry.
ARCE has a Quick Ratio of 1.06. This is a normal value and indicates that ARCE is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.06, ARCE is doing worse than 62.12% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.26 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 75.29% over the past year.
Measured over the past years, ARCE shows a decrease in Earnings Per Share. The EPS has been decreasing by -4.84% on average per year.
The Revenue has grown by 30.47% in the past year. This is a very strong growth!
The Revenue has been growing by 48.68% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)75.29%
EPS 3YN/A
EPS 5Y-4.84%
EPS growth Q2Q-366.67%
Revenue 1Y (TTM)30.47%
Revenue growth 3Y45.8%
Revenue growth 5Y48.68%
Revenue growth Q2Q14.29%
3.2 Future
ARCE is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 82.40% yearly.
ARCE is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 26.47% yearly.
EPS Next Y356.19%
EPS Next 2Y103.64%
EPS Next 3Y82.4%
EPS Next 5YN/A
Revenue Next Year38.52%
Revenue Next 2Y30.81%
Revenue Next 3Y26.47%
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 accelerating.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings Ratio is negative for ARCE. In the last year negative earnings were reported.
Based on the Price/Forward Earnings ratio of 37.42, the valuation of ARCE can be described as expensive.
ARCE's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 21.32. ARCE is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 37.42 |
4.2 Price Multiples
ARCE's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. ARCE is cheaper than 72.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 10.16 |
4.3 Compensation for Growth
ARCE's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ARCE's earnings are expected to grow with 82.40% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y103.64%
EPS Next 3Y82.4%
5. Dividend
5.1 Amount
ARCE does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
ARCO PLATFORM LTD - CLASS A
NASDAQ:ARCE (12/6/2023, 7:00:00 PM)
After market: 13.99 +0.01 (+0.07%)13.98
-0.01 (-0.07%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap927.43M
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
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Div Incr Years
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Surprises & Revisions
EPS beat(2)
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PT rev (1m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 37.42 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.52% | ||
| ROE | -1.22% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 13.91% | ||
| PM (TTM) | N/A | ||
| GM | 66.71% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.26 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)75.29%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y356.19%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)30.47%
Revenue growth 3Y45.8%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
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