ARKO CORP (ARKO) Stock Fundamental Analysis
NASDAQ:ARKO - Nasdaq - US0412421085 - Common Stock - Currency: USD
Taking everything into account, ARKO scores 3 out of 10 in our fundamental rating. ARKO was compared to 121 industry peers in the Specialty Retail industry. ARKO has only an average score on both its financial health and profitability. ARKO does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year ARKO was profitable.
In the past year ARKO had a positive cash flow from operations.
In the past 5 years ARKO has always been profitable.
Each year in the past 5 years ARKO had a positive operating cash flow.
1.2 Ratios
With a Return On Assets value of 0.42%, ARKO perfoms like the industry average, outperforming 49.59% of the companies in the same industry.
ARKO's Return On Equity of 4.01% is fine compared to the rest of the industry. ARKO outperforms 61.98% of its industry peers.
ARKO has a Return On Invested Capital of 2.78%. This is comparable to the rest of the industry: ARKO outperforms 46.28% of its industry peers.
ARKO had an Average Return On Invested Capital over the past 3 years of 3.60%. This is significantly below the industry average of 13.08%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.42% | ||
| ROE | 4.01% | ||
| ROIC | 2.78% |
ROA(3y)1.08%
ROA(5y)1.09%
ROE(3y)9.65%
ROE(5y)9.47%
ROIC(3y)3.6%
ROIC(5y)3.52%
1.3 Margins
The Profit Margin of ARKO (0.17%) 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 (1.34%) which is in line with its industry peers.
In the last couple of years the Operating Margin of ARKO has grown nicely.
ARKO's Gross Margin of 14.57% is on the low side compared to the rest of the industry. ARKO is outperformed by 89.26% 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 | 1.34% | ||
| PM (TTM) | 0.17% | ||
| GM | 14.57% |
OM growth 3Y-11.32%
OM growth 5Y111.61%
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.
The number of shares outstanding for ARKO has been reduced compared to 1 year ago.
Compared to 5 years ago, ARKO has less shares outstanding
The debt/assets ratio for ARKO is higher compared to a year ago.
2.2 Solvency
ARKO has an Altman-Z score of 2.74. 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.
Looking at the Altman-Z score, with a value of 2.74, ARKO is in the better half of the industry, outperforming 61.98% of the companies in the same industry.
The Debt to FCF ratio of ARKO is 10.22, which is on the high side as it means it would take ARKO, 10.22 years of fcf income to pay off all of its debts.
ARKO has a Debt to FCF ratio (10.22) which is in line with its industry peers.
ARKO has a Debt/Equity ratio of 2.86. This is a high value indicating a heavy dependency on external financing.
ARKO's Debt to Equity ratio of 2.86 is on the low side compared to the rest of the industry. ARKO is outperformed by 72.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.86 | ||
| Debt/FCF | 10.22 | ||
| Altman-Z | 2.74 |
ROIC/WACC0.3
WACC9.3%
2.3 Liquidity
ARKO has a Current Ratio of 1.62. This is a normal value and indicates that ARKO is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Current ratio value of 1.62, ARKO is doing good in the industry, outperforming 66.94% of the companies in the same industry.
ARKO has a Quick Ratio of 1.10. This is a normal value and indicates that ARKO is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Quick ratio value of 1.10, ARKO is doing good in the industry, outperforming 76.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.62 | ||
| Quick Ratio | 1.1 |
3. Growth
3.1 Past
The earnings per share for ARKO have decreased strongly by -48.00% in the last year.
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 -7.23%.
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)-48%
EPS 3Y-33.4%
EPS 5YN/A
EPS Q2Q%-909.37%
Revenue 1Y (TTM)-7.23%
Revenue growth 3Y5.59%
Revenue growth 5Y16.16%
Sales Q2Q%-10.79%
3.2 Future
ARKO is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -19.06% yearly.
Based on estimates for the next years, ARKO will show a decrease in Revenue. The Revenue will decrease by -3.82% on average per year.
EPS Next Y-64.69%
EPS Next 2Y-62.94%
EPS Next 3Y-38.26%
EPS Next 5Y-19.06%
Revenue Next Year-10.64%
Revenue Next 2Y-5.95%
Revenue Next 3Y-4.42%
Revenue Next 5Y-3.82%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last 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
ARKO is valuated quite expensively with a Price/Earnings ratio of 31.77.
ARKO's Price/Earnings is on the same level as the industry average.
ARKO is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.10, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 89.98, ARKO can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, ARKO is valued a bit more expensive than 62.81% of the companies in the same industry.
ARKO is valuated expensively when we compare the Price/Forward Earnings ratio to 20.74, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.77 | ||
| Fwd PE | 89.98 |
4.2 Price Multiples
ARKO's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ARKO is cheaper than 80.17% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ARKO indicates a rather cheap valuation: ARKO is cheaper than 95.04% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 4.39 | ||
| EV/EBITDA | 5.27 |
4.3 Compensation for Growth
A cheap valuation may be justified as ARKO's earnings are expected to decrease with -38.26% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-62.94%
EPS Next 3Y-38.26%
5. Dividend
5.1 Amount
ARKO has a Yearly Dividend Yield of 2.98%.
The stock price of ARKO dropped by -37.52% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
ARKO's Dividend Yield is rather good when compared to the industry average which is at 5.47. ARKO pays more dividend than 85.12% of the companies in the same industry.
ARKO's Dividend Yield is a higher than the S&P500 average which is at 2.43.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.98% |
5.2 History
ARKO has paid a dividend for less than 5 years, so there is no long track record yet.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years2
5.3 Sustainability
ARKO pays out 130.94% of its income as dividend. This is not a sustainable payout ratio.
DP130.94%
EPS Next 2Y-62.94%
EPS Next 3Y-38.26%
4.13
-0.06 (-1.43%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners56.23%
Inst Owner Change-0.72%
Ins Owners11.06%
Ins Owner Change1.46%
Market Cap473.63M
Analysts78
Price Target7.46 (80.63%)
Short Float %6.22%
Short Ratio5.42
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.98% |
Yearly Dividend0.17
Dividend Growth(5Y)N/A
DP130.94%
Div Incr Years1
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-266.87%
Min EPS beat(2)-492.16%
Max EPS beat(2)-41.59%
EPS beat(4)2
Avg EPS beat(4)-90.89%
Min EPS beat(4)-492.16%
Max EPS beat(4)90.44%
EPS beat(8)3
Avg EPS beat(8)-79.19%
EPS beat(12)4
Avg EPS beat(12)-60.17%
EPS beat(16)6
Avg EPS beat(16)-43.76%
Revenue beat(2)0
Avg Revenue beat(2)-7.86%
Min Revenue beat(2)-8.37%
Max Revenue beat(2)-7.35%
Revenue beat(4)0
Avg Revenue beat(4)-4.7%
Min Revenue beat(4)-8.37%
Max Revenue beat(4)-0.82%
Revenue beat(8)2
Avg Revenue beat(8)-3.63%
Revenue beat(12)4
Avg Revenue beat(12)-2.79%
Revenue beat(16)6
Avg Revenue beat(16)-2.28%
PT rev (1m)0%
PT rev (3m)-7.87%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-86.11%
EPS NY rev (1m)0%
EPS NY rev (3m)-78.05%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-9.3%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-6.82%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.77 | ||
| Fwd PE | 89.98 | ||
| P/S | 0.05 | ||
| P/FCF | 4.39 | ||
| P/OCF | 2.13 | ||
| P/B | 1.26 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.27 |
EPS(TTM)0.13
EY3.15%
EPS(NY)0.05
Fwd EY1.11%
FCF(TTM)0.94
FCFY22.79%
OCF(TTM)1.93
OCFY46.84%
SpS76.14
BVpS3.29
TBVpS-0.92
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.42% | ||
| ROE | 4.01% | ||
| ROCE | 3.67% | ||
| ROIC | 2.78% | ||
| ROICexc | 3.03% | ||
| ROICexgc | 3.63% | ||
| OM | 1.34% | ||
| PM (TTM) | 0.17% | ||
| GM | 14.57% | ||
| FCFM | 1.24% |
ROA(3y)1.08%
ROA(5y)1.09%
ROE(3y)9.65%
ROE(5y)9.47%
ROIC(3y)3.6%
ROIC(5y)3.52%
ROICexc(3y)3.95%
ROICexc(5y)3.92%
ROICexgc(3y)4.74%
ROICexgc(5y)4.74%
ROCE(3y)4.76%
ROCE(5y)4.66%
ROICexcg growth 3Y-14.62%
ROICexcg growth 5Y117.5%
ROICexc growth 3Y-14.39%
ROICexc growth 5Y114.59%
OM growth 3Y-11.32%
OM growth 5Y111.61%
PM growth 3Y-37.88%
PM growth 5YN/A
GM growth 3Y2.7%
GM growth 5Y-1.33%
F-Score6
Asset Turnover2.41
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.86 | ||
| Debt/FCF | 10.22 | ||
| Debt/EBITDA | 4.33 | ||
| Cap/Depr | 86.03% | ||
| Cap/Sales | 1.3% | ||
| Interest Coverage | 1.27 | ||
| Cash Conversion | 89.08% | ||
| Profit Quality | 715.1% | ||
| Current Ratio | 1.62 | ||
| Quick Ratio | 1.1 | ||
| Altman-Z | 2.74 |
F-Score6
WACC9.3%
ROIC/WACC0.3
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)-48%
EPS 3Y-33.4%
EPS 5YN/A
EPS Q2Q%-909.37%
EPS Next Y-64.69%
EPS Next 2Y-62.94%
EPS Next 3Y-38.26%
EPS Next 5Y-19.06%
Revenue 1Y (TTM)-7.23%
Revenue growth 3Y5.59%
Revenue growth 5Y16.16%
Sales Q2Q%-10.79%
Revenue Next Year-10.64%
Revenue Next 2Y-5.95%
Revenue Next 3Y-4.42%
Revenue Next 5Y-3.82%
EBIT growth 1Y-22.22%
EBIT growth 3Y-6.37%
EBIT growth 5Y145.8%
EBIT Next Year136.76%
EBIT Next 3Y34.49%
EBIT Next 5Y17.52%
FCF growth 1Y333.77%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y63.02%
OCF growth 3Y11.7%
OCF growth 5Y38.65%