ARIS WATER SOLUTIONS INC-A (ARIS) Stock Fundamental Analysis
USA - NYSE:ARIS - US04041L1061 - Common Stock
24.53 USD
+0.33 (+1.36%)
24.53 USD
0 (0%)
Taking everything into account, ARIS scores 4 out of 10 in our fundamental rating. ARIS was compared to 61 industry peers in the Energy Equipment & Services industry. While ARIS is still in line with the averages on profitability rating, there are concerns on its financial health. ARIS has a correct valuation and a medium growth rate.
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.
Each year in the past 5 years ARIS had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 1.88%, ARIS is doing worse than 62.30% of the companies in the same industry.
ARIS has a Return On Equity (7.65%) which is in line with its industry peers.
With a decent Return On Invested Capital value of 7.39%, ARIS is doing good in the industry, outperforming 65.57% of the companies in the same industry.
ARIS had an Average Return On Invested Capital over the past 3 years of 5.83%. This is below the industry average of 8.05%.
The last Return On Invested Capital (7.39%) for ARIS is above the 3 year average (5.83%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.88% | ||
| ROE | 7.65% | ||
| ROIC | 7.39% |
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 5.61%, ARIS perfoms like the industry average, outperforming 50.82% of the companies in the same industry.
In the last couple of years the Profit Margin of ARIS has declined.
ARIS has a Operating Margin of 23.95%. This is amongst the best in the industry. ARIS outperforms 90.16% of its industry peers.
In the last couple of years the Operating Margin of ARIS has grown nicely.
The Gross Margin of ARIS (39.67%) is better than 78.69% of its industry peers.
In the last couple of years the Gross Margin of ARIS has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.95% | ||
| PM (TTM) | 5.61% | ||
| GM | 39.67% |
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so 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.
Compared to 1 year ago, ARIS has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.45, we must say that ARIS is in the distress zone and has some risk of bankruptcy.
ARIS has a Altman-Z score of 1.45. This is in the lower half of the industry: ARIS underperforms 65.57% of its industry peers.
ARIS has a debt to FCF ratio of 4.38. This is a neutral value as ARIS would need 4.38 years to pay back of all of its debts.
ARIS has a Debt to FCF ratio of 4.38. This is comparable to the rest of the industry: ARIS outperforms 50.82% of its industry peers.
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 81.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.27 | ||
| Debt/FCF | 4.38 | ||
| Altman-Z | 1.45 |
ROIC/WACC0.79
WACC9.32%
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 has a worse Current ratio (1.22) than 81.97% of its industry peers.
A Quick Ratio of 1.22 indicates that ARIS should not have too much problems paying its short term obligations.
ARIS has a Quick ratio of 1.22. This is in the lower half of the industry: ARIS underperforms 67.21% 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 16.96%, which is quite good.
The Earnings Per Share has been growing by 27.41% on average over the past years. This is a very strong growth
Looking at the last year, ARIS shows a quite strong growth in Revenue. The Revenue has grown by 16.42% in the last year.
The Revenue has been growing by 29.67% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)16.96%
EPS 3YN/A
EPS 5Y27.41%
EPS Q2Q%13.79%
Revenue 1Y (TTM)16.42%
Revenue growth 3Y23.83%
Revenue growth 5Y29.67%
Sales Q2Q%22.72%
3.2 Future
ARIS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.34% yearly.
The Revenue is expected to grow by 6.30% on average over the next years.
EPS Next Y16.85%
EPS Next 2Y11.4%
EPS Next 3Y15.09%
EPS Next 5Y19.34%
Revenue Next Year13.96%
Revenue Next 2Y8.75%
Revenue Next 3Y8.08%
Revenue Next 5Y6.3%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 18.73, the valuation of ARIS can be described as rather expensive.
ARIS's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 27.29. ARIS is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 15.69 indicates a correct valuation of ARIS.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ARIS is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of ARIS to the average of the S&P500 Index (22.80), we can say ARIS is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.73 | ||
| Fwd PE | 15.69 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ARIS is valued more expensive than 80.33% of the companies in the same industry.
ARIS's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.1 | ||
| EV/EBITDA | 9.68 |
4.3 Compensation for Growth
ARIS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
ARIS has a very decent profitability rating, which may justify a higher PE ratio.
ARIS's earnings are expected to grow with 15.09% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.11
PEG (5Y)0.68
EPS Next 2Y11.4%
EPS Next 3Y15.09%
5. Dividend
5.1 Amount
ARIS has a Yearly Dividend Yield of 2.31%.
Compared to an average industry Dividend Yield of 3.29, ARIS pays a bit more dividend than its industry peers.
ARIS's Dividend Yield is comparable with the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
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
111.96% of the earnings are spent on dividend by ARIS. This is not a sustainable payout ratio.
DP111.96%
EPS Next 2Y11.4%
EPS Next 3Y15.09%
24.53
+0.33 (+1.36%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryEnergy Equipment & Services
Earnings (Last)
Earnings (Next)
Inst Owners109.68%
Inst Owner Change-3.26%
Ins Owners4.18%
Ins Owner Change-0.07%
Market Cap1.45B
Analysts71.25
Price Target27.09 (10.44%)
Short Float %7.63%
Short Ratio2.14
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
Yearly Dividend0.42
Dividend Growth(5Y)N/A
DP111.96%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.73%
Min EPS beat(2)10.74%
Max EPS beat(2)16.71%
EPS beat(4)3
Avg EPS beat(4)5.86%
Min EPS beat(4)-16.05%
Max EPS beat(4)16.71%
EPS beat(8)7
Avg EPS beat(8)15.16%
EPS beat(12)9
Avg EPS beat(12)9.68%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)2.8%
Min Revenue beat(2)1.26%
Max Revenue beat(2)4.35%
Revenue beat(4)4
Avg Revenue beat(4)4.57%
Min Revenue beat(4)1.26%
Max Revenue beat(4)6.5%
Revenue beat(8)8
Avg Revenue beat(8)4.11%
Revenue beat(12)11
Avg Revenue beat(12)4%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-9.46%
PT rev (3m)-10.48%
EPS NQ rev (1m)6.31%
EPS NQ rev (3m)3.55%
EPS NY rev (1m)0%
EPS NY rev (3m)5.29%
Revenue NQ rev (1m)0.77%
Revenue NQ rev (3m)0.38%
Revenue NY rev (1m)-0.21%
Revenue NY rev (3m)0.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.73 | ||
| Fwd PE | 15.69 | ||
| P/S | 3.05 | ||
| P/FCF | 14.1 | ||
| P/OCF | 7.77 | ||
| P/B | 4.16 | ||
| P/tB | 12.22 | ||
| EV/EBITDA | 9.68 |
EPS(TTM)1.31
EY5.34%
EPS(NY)1.56
Fwd EY6.37%
FCF(TTM)1.74
FCFY7.09%
OCF(TTM)3.16
OCFY12.87%
SpS8.03
BVpS5.89
TBVpS2.01
PEG (NY)1.11
PEG (5Y)0.68
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.88% | ||
| ROE | 7.65% | ||
| ROCE | 8.66% | ||
| ROIC | 7.39% | ||
| ROICexc | 7.55% | ||
| ROICexgc | 9.2% | ||
| OM | 23.95% | ||
| PM (TTM) | 5.61% | ||
| GM | 39.67% | ||
| FCFM | 21.65% |
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 Turnover0.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.27 | ||
| Debt/FCF | 4.38 | ||
| Debt/EBITDA | 2.29 | ||
| Cap/Depr | 105.22% | ||
| Cap/Sales | 17.65% | ||
| Interest Coverage | 3.5 | ||
| Cash Conversion | 96.52% | ||
| Profit Quality | 386.19% | ||
| Current Ratio | 1.22 | ||
| Quick Ratio | 1.22 | ||
| Altman-Z | 1.45 |
F-Score9
WACC9.32%
ROIC/WACC0.79
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)16.96%
EPS 3YN/A
EPS 5Y27.41%
EPS Q2Q%13.79%
EPS Next Y16.85%
EPS Next 2Y11.4%
EPS Next 3Y15.09%
EPS Next 5Y19.34%
Revenue 1Y (TTM)16.42%
Revenue growth 3Y23.83%
Revenue growth 5Y29.67%
Sales Q2Q%22.72%
Revenue Next Year13.96%
Revenue Next 2Y8.75%
Revenue Next 3Y8.08%
Revenue Next 5Y6.3%
EBIT growth 1Y14.41%
EBIT growth 3Y32.17%
EBIT growth 5Y55.99%
EBIT Next Year98.99%
EBIT Next 3Y31.72%
EBIT Next 5Y20.48%
FCF growth 1Y320.01%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y44.43%
OCF growth 3Y44.89%
OCF growth 5Y112.28%