ARKO CORP (ARKO) Stock Fundamental Analysis
NASDAQ:ARKO - Nasdaq - US0412421085 - Common Stock - Currency: USD
ARKO gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 120 industry peers in the Specialty Retail industry. ARKO has an average financial health and profitability rating. ARKO has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
ARKO had positive earnings in the past year.
ARKO had a positive operating cash flow in the past year.
In the past 5 years ARKO has always been profitable.
In the past 5 years ARKO always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 0.08%, ARKO is in line with its industry, outperforming 49.17% of the companies in the same industry.
The Return On Equity of ARKO (0.85%) is comparable to the rest of the industry.
With a Return On Invested Capital value of 2.35%, ARKO perfoms like the industry average, outperforming 45.83% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for ARKO is significantly below the industry average of 13.34%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.08% | ||
| ROE | 0.85% | ||
| ROIC | 2.35% |
ROA(3y)1.08%
ROA(5y)1.09%
ROE(3y)9.65%
ROE(5y)9.47%
ROIC(3y)3.4%
ROIC(5y)3.4%
1.3 Margins
ARKO has a Profit Margin (0.04%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of ARKO has declined.
ARKO has a Operating Margin (1.15%) which is in line with its industry peers.
ARKO's Operating Margin has improved in the last couple of years.
ARKO has a Gross Margin of 14.71%. This is amonst the worse of the industry: ARKO underperforms 89.17% of its industry peers.
In the last couple of years the Gross Margin of ARKO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.15% | ||
| PM (TTM) | 0.04% | ||
| GM | 14.71% |
OM growth 3Y-14.11%
OM growth 5Y107.59%
PM growth 3Y-37.88%
PM growth 5YN/A
GM growth 3Y2.7%
GM growth 5Y-1.33%
2. Health
2.1 Basic Checks
ARKO 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, ARKO has less shares outstanding
ARKO has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, ARKO has a worse debt to assets ratio.
2.2 Solvency
ARKO has an Altman-Z score of 2.65. This is not the best score and indicates that ARKO is in the grey zone with still only limited risk for bankruptcy at the moment.
ARKO has a better Altman-Z score (2.65) than 63.33% of its industry peers.
The Debt to FCF ratio of ARKO is 7.84, which is on the high side as it means it would take ARKO, 7.84 years of fcf income to pay off all of its debts.
ARKO's Debt to FCF ratio of 7.84 is in line compared to the rest of the industry. ARKO outperforms 55.83% of its industry peers.
ARKO has a Debt/Equity ratio of 3.03. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 3.03, ARKO is doing worse than 75.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.03 | ||
| Debt/FCF | 7.84 | ||
| Altman-Z | 2.65 |
ROIC/WACC0.25
WACC9.4%
2.3 Liquidity
A Current Ratio of 1.55 indicates that ARKO should not have too much problems paying its short term obligations.
With a decent Current ratio value of 1.55, ARKO is doing good in the industry, outperforming 65.00% of the companies in the same industry.
A Quick Ratio of 1.08 indicates that ARKO should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.08, ARKO is in the better half of the industry, outperforming 76.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.08 |
3. Growth
3.1 Past
ARKO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -88.46%.
The earnings per share for ARKO have been decreasing by -33.40% on average. This is quite bad
ARKO shows a decrease in Revenue. In the last year, the revenue decreased by -9.67%.
Measured over the past years, ARKO shows a quite strong growth in Revenue. The Revenue has been growing by 16.16% on average per year.
EPS 1Y (TTM)-88.46%
EPS 3Y-33.4%
EPS 5YN/A
EPS Q2Q%-500%
Revenue 1Y (TTM)-9.67%
Revenue growth 3Y5.59%
Revenue growth 5Y16.16%
Sales Q2Q%-11.75%
3.2 Future
Based on estimates for the next years, ARKO will show a very negative growth in Earnings Per Share. The EPS will decrease by -19.06% on average per year.
The Revenue is expected to decrease by -3.82% on average over the next years.
EPS Next Y-39.84%
EPS Next 2Y-31.39%
EPS Next 3Y-40.69%
EPS Next 5Y-19.06%
Revenue Next Year-10.92%
Revenue Next 2Y-6.23%
Revenue Next 3Y-4.45%
Revenue Next 5Y-3.82%
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.
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
The Price/Earnings ratio is 142.67, which means the current valuation is very expensive for ARKO.
The rest of the industry has a similar Price/Earnings ratio as ARKO.
ARKO's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 26.43.
A Price/Forward Earnings ratio of 69.93 indicates a quite expensive valuation of ARKO.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ARKO indicates a slightly more expensive valuation: ARKO is more expensive than 64.17% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.17, ARKO is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 142.67 | ||
| Fwd PE | 69.93 |
4.2 Price Multiples
78.33% of the companies in the same industry are more expensive than ARKO, based on the Enterprise Value to EBITDA ratio.
ARKO's Price/Free Cash Flow ratio is rather cheap when compared to the industry. ARKO is cheaper than 96.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 3.47 | ||
| EV/EBITDA | 5.68 |
4.3 Compensation for Growth
ARKO's earnings are expected to decrease with -40.69% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-31.39%
EPS Next 3Y-40.69%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.68%, ARKO has a reasonable but not impressive dividend return.
ARKO's Dividend Yield is rather good when compared to the industry average which is at 5.25. ARKO pays more dividend than 84.17% of the companies in the same industry.
ARKO's Dividend Yield is comparable with the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.68% |
5.2 History
ARKO 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 Years0
Div Non Decr Years2
5.3 Sustainability
ARKO pays out 652.77% of its income as dividend. This is not a sustainable payout ratio.
DP652.77%
EPS Next 2Y-31.39%
EPS Next 3Y-40.69%
4.28
-0.12 (-2.73%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners56.23%
Inst Owner Change5.69%
Ins Owners11.06%
Ins Owner Change1.46%
Market Cap487.71M
Analysts78
Price Target7.4 (72.9%)
Short Float %7.04%
Short Ratio8.6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.68% |
Yearly Dividend0.17
Dividend Growth(5Y)N/A
DP652.77%
Div Incr Years0
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-230.68%
Min EPS beat(2)-492.16%
Max EPS beat(2)30.8%
EPS beat(4)2
Avg EPS beat(4)-105.8%
Min EPS beat(4)-492.16%
Max EPS beat(4)79.74%
EPS beat(8)4
Avg EPS beat(8)-56.44%
EPS beat(12)5
Avg EPS beat(12)-52.54%
EPS beat(16)6
Avg EPS beat(16)-43.03%
Revenue beat(2)0
Avg Revenue beat(2)-5.62%
Min Revenue beat(2)-8.37%
Max Revenue beat(2)-2.87%
Revenue beat(4)0
Avg Revenue beat(4)-4.85%
Min Revenue beat(4)-8.37%
Max Revenue beat(4)-0.82%
Revenue beat(8)2
Avg Revenue beat(8)-3.31%
Revenue beat(12)3
Avg Revenue beat(12)-3.04%
Revenue beat(16)5
Avg Revenue beat(16)-2.77%
PT rev (1m)-0.85%
PT rev (3m)-8.66%
EPS NQ rev (1m)2.13%
EPS NQ rev (3m)-21.74%
EPS NY rev (1m)70.38%
EPS NY rev (3m)-63.49%
Revenue NQ rev (1m)-1.04%
Revenue NQ rev (3m)-8.78%
Revenue NY rev (1m)-0.31%
Revenue NY rev (3m)-7.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 142.67 | ||
| Fwd PE | 69.93 | ||
| P/S | 0.06 | ||
| P/FCF | 3.47 | ||
| P/OCF | 1.93 | ||
| P/B | 1.37 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.68 |
EPS(TTM)0.03
EY0.7%
EPS(NY)0.06
Fwd EY1.43%
FCF(TTM)1.23
FCFY28.79%
OCF(TTM)2.22
OCFY51.77%
SpS74.49
BVpS3.12
TBVpS-1.07
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.08% | ||
| ROE | 0.85% | ||
| ROCE | 3.11% | ||
| ROIC | 2.35% | ||
| ROICexc | 2.57% | ||
| ROICexgc | 3.08% | ||
| OM | 1.15% | ||
| PM (TTM) | 0.04% | ||
| GM | 14.71% | ||
| FCFM | 1.65% |
ROA(3y)1.08%
ROA(5y)1.09%
ROE(3y)9.65%
ROE(5y)9.47%
ROIC(3y)3.4%
ROIC(5y)3.4%
ROICexc(3y)3.74%
ROICexc(5y)3.8%
ROICexgc(3y)4.49%
ROICexgc(5y)4.59%
ROCE(3y)4.5%
ROCE(5y)4.5%
ROICexcg growth 3Y-17.3%
ROICexcg growth 5Y113.37%
ROICexc growth 3Y-17.08%
ROICexc growth 5Y110.52%
OM growth 3Y-14.11%
OM growth 5Y107.59%
PM growth 3Y-37.88%
PM growth 5YN/A
GM growth 3Y2.7%
GM growth 5Y-1.33%
F-Score6
Asset Turnover2.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.03 | ||
| Debt/FCF | 7.84 | ||
| Debt/EBITDA | 4.61 | ||
| Cap/Depr | 82.66% | ||
| Cap/Sales | 1.32% | ||
| Interest Coverage | 1.07 | ||
| Cash Conversion | 108.28% | ||
| Profit Quality | 4660.7% | ||
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.08 | ||
| Altman-Z | 2.65 |
F-Score6
WACC9.4%
ROIC/WACC0.25
Cap/Depr(3y)90.08%
Cap/Depr(5y)112.67%
Cap/Sales(3y)1.19%
Cap/Sales(5y)1.55%
Profit Quality(3y)323.16%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-88.46%
EPS 3Y-33.4%
EPS 5YN/A
EPS Q2Q%-500%
EPS Next Y-39.84%
EPS Next 2Y-31.39%
EPS Next 3Y-40.69%
EPS Next 5Y-19.06%
Revenue 1Y (TTM)-9.67%
Revenue growth 3Y5.59%
Revenue growth 5Y16.16%
Sales Q2Q%-11.75%
Revenue Next Year-10.92%
Revenue Next 2Y-6.23%
Revenue Next 3Y-4.45%
Revenue Next 5Y-3.82%
EBIT growth 1Y-27.2%
EBIT growth 3Y-9.31%
EBIT growth 5Y141.14%
EBIT Next Year135.49%
EBIT Next 3Y32.83%
EBIT Next 5Y17.52%
FCF growth 1Y50.03%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y29.42%
OCF growth 3Y11.7%
OCF growth 5Y38.65%