ARIS WATER SOLUTIONS INC-A (ARIS) Stock Fundamental Analysis
NYSE:ARIS - New York Stock Exchange, Inc. - US04041L1061 - Common Stock - Currency: USD
Overall ARIS gets a fundamental rating of 5 out of 10. We evaluated ARIS against 62 industry peers in the Energy Equipment & Services industry. There are concerns on the financial health of ARIS while its profitability can be described as average. ARIS is growing strongly while it is still valued neutral. This is a good combination!
1. Profitability
1.1 Basic Checks
In the past year ARIS was profitable.
ARIS had a positive operating cash flow in the past year.
In multiple years ARIS reported negative net income over the last 5 years.
ARIS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 1.75%, ARIS is doing worse than 67.74% of the companies in the same industry.
ARIS has a Return On Equity of 7.14%. This is comparable to the rest of the industry: ARIS outperforms 48.39% of its industry peers.
With a Return On Invested Capital value of 7.13%, ARIS perfoms like the industry average, outperforming 53.23% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ARIS is below the industry average of 8.69%.
The 3 year average ROIC (5.83%) for ARIS is below the current ROIC(7.13%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.75% | ||
| ROE | 7.14% | ||
| ROIC | 7.13% |
ROA(3y)1.1%
ROA(5y)0.45%
ROE(3y)4.51%
ROE(5y)1.92%
ROIC(3y)5.83%
ROIC(5y)4.48%
1.3 Margins
With a Profit Margin value of 5.71%, ARIS perfoms like the industry average, outperforming 45.16% of the companies in the same industry.
ARIS's Profit Margin has declined in the last couple of years.
ARIS's Operating Margin of 25.24% is amongst the best of the industry. ARIS outperforms 91.94% of its industry peers.
In the last couple of years the Operating Margin of ARIS has grown nicely.
With an excellent Gross Margin value of 40.85%, ARIS belongs to the best of the industry, outperforming 80.65% of the companies in the same industry.
ARIS's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.24% | ||
| PM (TTM) | 5.71% | ||
| GM | 40.85% |
OM growth 3Y6.73%
OM growth 5Y20.3%
PM growth 3YN/A
PM growth 5Y-12.32%
GM growth 3Y6.48%
GM growth 5Y12.28%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ARIS is destroying value.
ARIS has more shares outstanding than it did 1 year ago.
The number of shares outstanding for ARIS has been increased compared to 5 years ago.
The debt/assets ratio for ARIS has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.37, we must say that ARIS is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.37, ARIS is doing worse than 62.90% of the companies in the same industry.
The Debt to FCF ratio of ARIS is 5.71, which is a neutral value as it means it would take ARIS, 5.71 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of ARIS (5.71) is comparable to the rest of the industry.
ARIS has a Debt/Equity ratio of 1.27. This is a high value indicating a heavy dependency on external financing.
ARIS has a worse Debt to Equity ratio (1.27) than 83.87% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.27 | ||
| Debt/FCF | 5.71 | ||
| Altman-Z | 1.37 |
ROIC/WACC0.75
WACC9.53%
2.3 Liquidity
ARIS has a Current Ratio of 1.22. This is a normal value and indicates that ARIS is financially healthy and should not expect problems in meeting its short term obligations.
ARIS's Current ratio of 1.22 is on the low side compared to the rest of the industry. ARIS is outperformed by 85.48% of its industry peers.
ARIS has a Quick Ratio of 1.22. This is a normal value and indicates that ARIS is financially healthy and should not expect problems in meeting its short term obligations.
ARIS has a Quick ratio of 1.22. This is in the lower half of the industry: ARIS underperforms 72.58% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.22 | ||
| Quick Ratio | 1.22 |
3. Growth
3.1 Past
ARIS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 20.95%, which is quite impressive.
ARIS shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.41% yearly.
The Revenue has grown by 12.03% in the past year. This is quite good.
ARIS shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 29.67% yearly.
EPS 1Y (TTM)20.95%
EPS 3YN/A
EPS 5Y27.41%
EPS Q2Q%2.94%
Revenue 1Y (TTM)12.03%
Revenue growth 3Y23.83%
Revenue growth 5Y29.67%
Sales Q2Q%16.52%
3.2 Future
Based on estimates for the next years, ARIS will show a very strong growth in Earnings Per Share. The EPS will grow by 21.20% on average per year.
The Revenue is expected to grow by 6.30% on average over the next years.
EPS Next Y14.26%
EPS Next 2Y13.39%
EPS Next 3Y16.64%
EPS Next 5Y21.2%
Revenue Next Year14.41%
Revenue Next 2Y8.47%
Revenue Next 3Y8.31%
Revenue Next 5Y6.3%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
ARIS is valuated rather expensively with a Price/Earnings ratio of 18.39.
The rest of the industry has a similar Price/Earnings ratio as ARIS.
The average S&P500 Price/Earnings ratio is at 25.82. ARIS is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 14.41 indicates a correct valuation of ARIS.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ARIS indicates a slightly more expensive valuation: ARIS is more expensive than 61.29% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.76. ARIS is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.39 | ||
| Fwd PE | 14.41 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ARIS is valued expensively inside the industry as 87.10% of the companies are valued cheaper.
ARIS's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.5 | ||
| EV/EBITDA | 9.55 |
4.3 Compensation for Growth
ARIS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of ARIS may justify a higher PE ratio.
A more expensive valuation may be justified as ARIS's earnings are expected to grow with 16.64% in the coming years.
PEG (NY)1.29
PEG (5Y)0.67
EPS Next 2Y13.39%
EPS Next 3Y16.64%
5. Dividend
5.1 Amount
ARIS has a Yearly Dividend Yield of 2.40%. Purely for dividend investing, there may be better candidates out there.
ARIS's Dividend Yield is a higher than the industry average which is at 4.01.
ARIS's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
5.2 History
ARIS has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
98.70% of the earnings are spent on dividend by ARIS. This is not a sustainable payout ratio.
DP98.7%
EPS Next 2Y13.39%
EPS Next 3Y16.64%
23.35
-0.05 (-0.21%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryEnergy Equipment & Services
Earnings (Last)
Earnings (Next)
Inst Owners86.92%
Inst Owner Change24.95%
Ins Owners2.97%
Ins Owner Change2.28%
Market Cap1.38B
Analysts77.89
Price Target33.49 (43.43%)
Short Float %9.36%
Short Ratio3.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
Yearly Dividend0.42
Dividend Growth(5Y)N/A
DP98.7%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-2%
Min EPS beat(2)-16.05%
Max EPS beat(2)12.04%
EPS beat(4)3
Avg EPS beat(4)13.63%
Min EPS beat(4)-16.05%
Max EPS beat(4)46.66%
EPS beat(8)7
Avg EPS beat(8)30.91%
EPS beat(12)9
Avg EPS beat(12)25.92%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)6.35%
Min Revenue beat(2)6.19%
Max Revenue beat(2)6.5%
Revenue beat(4)4
Avg Revenue beat(4)5.01%
Min Revenue beat(4)2.29%
Max Revenue beat(4)6.5%
Revenue beat(8)8
Avg Revenue beat(8)5.04%
Revenue beat(12)11
Avg Revenue beat(12)3.92%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)1.03%
PT rev (3m)17.98%
EPS NQ rev (1m)2.96%
EPS NQ rev (3m)-10.2%
EPS NY rev (1m)4.73%
EPS NY rev (3m)-5.17%
Revenue NQ rev (1m)0.3%
Revenue NQ rev (3m)4.33%
Revenue NY rev (1m)1.59%
Revenue NY rev (3m)6.1%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.39 | ||
| Fwd PE | 14.41 | ||
| P/S | 3.17 | ||
| P/FCF | 17.5 | ||
| P/OCF | 7.72 | ||
| P/B | 3.96 | ||
| P/tB | 11.62 | ||
| EV/EBITDA | 9.55 |
EPS(TTM)1.27
EY5.44%
EPS(NY)1.62
Fwd EY6.94%
FCF(TTM)1.33
FCFY5.71%
OCF(TTM)3.03
OCFY12.96%
SpS7.37
BVpS5.9
TBVpS2.01
PEG (NY)1.29
PEG (5Y)0.67
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.75% | ||
| ROE | 7.14% | ||
| ROCE | 8.36% | ||
| ROIC | 7.13% | ||
| ROICexc | 7.29% | ||
| ROICexgc | 8.87% | ||
| OM | 25.24% | ||
| PM (TTM) | 5.71% | ||
| GM | 40.85% | ||
| FCFM | 18.12% |
ROA(3y)1.1%
ROA(5y)0.45%
ROE(3y)4.51%
ROE(5y)1.92%
ROIC(3y)5.83%
ROIC(5y)4.48%
ROICexc(3y)5.9%
ROICexc(5y)4.57%
ROICexgc(3y)7.47%
ROICexgc(5y)6.05%
ROCE(3y)6.84%
ROCE(5y)5.25%
ROICexcg growth 3Y14.01%
ROICexcg growth 5Y32.54%
ROICexc growth 3Y22.24%
ROICexc growth 5Y40.48%
OM growth 3Y6.73%
OM growth 5Y20.3%
PM growth 3YN/A
PM growth 5Y-12.32%
GM growth 3Y6.48%
GM growth 5Y12.28%
F-Score9
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.27 | ||
| Debt/FCF | 5.71 | ||
| Debt/EBITDA | 2.35 | ||
| Cap/Depr | 126.31% | ||
| Cap/Sales | 22.96% | ||
| Interest Coverage | 3.32 | ||
| Cash Conversion | 94.61% | ||
| Profit Quality | 317.06% | ||
| Current Ratio | 1.22 | ||
| Quick Ratio | 1.22 | ||
| Altman-Z | 1.37 |
F-Score9
WACC9.53%
ROIC/WACC0.75
Cap/Depr(3y)188.27%
Cap/Depr(5y)201.28%
Cap/Sales(3y)37.3%
Cap/Sales(5y)45.17%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)20.95%
EPS 3YN/A
EPS 5Y27.41%
EPS Q2Q%2.94%
EPS Next Y14.26%
EPS Next 2Y13.39%
EPS Next 3Y16.64%
EPS Next 5Y21.2%
Revenue 1Y (TTM)12.03%
Revenue growth 3Y23.83%
Revenue growth 5Y29.67%
Sales Q2Q%16.52%
Revenue Next Year14.41%
Revenue Next 2Y8.47%
Revenue Next 3Y8.31%
Revenue Next 5Y6.3%
EBIT growth 1Y31.87%
EBIT growth 3Y32.17%
EBIT growth 5Y55.99%
EBIT Next Year100.98%
EBIT Next 3Y33.6%
EBIT Next 5Y21.13%
FCF growth 1Y458.05%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-2.72%
OCF growth 3Y44.89%
OCF growth 5Y112.28%